Ahead of the long weekend, and amid the swirl of headlines that have seemingly centered on “all tariffs all the time,” it may have been easy to overlook the steady march of legislation that moves through Congress.
To that end, the House Financial Services Committee late last week advanced several bills out of committee — which move them closer to a vote in the full House — and which would reshape banking regulations and initial public offerings (IPOs). In at least some cases, the mechanisms of going public might change, making it easier for a broader swath of companies, including FinTech, to move toward the public markets.
For banks, some of the ways risks (and by extension capital requirements) are defined are redefined.
Moving to Market
In the Encouraging Public Offerings Act of 2025, the 92-year old Securities Act of 1933 would be expanded to let more companies “test the waters” before they file confidential registration statements with the Securities and Exchange Commission (SEC). During that testing phase, firms gauge interest from would-be investors, including institutional investors, in a possible listing before filing papers with the SEC.
Under the Helping Startups Continue to Grow Act, the definition of “emerging growth companies” would be expanded, in ways that that keep them under that umbrella definition for longer, and thus have simpler reporting structures than their larger brethren (and lower operational costs). The new regulation would raise gross annual revenue thresholds defining those firms from $1 billion to $3 billion. The timeframe for that classification would also be extended, from five years to 10 years after an IPO.
The above legislation comes at a time when FinTechs such as Chime are coming to market with IPO filings, and artificial intelligence (AI)-underpinned firms such as Hinge Health are readying their own listings.
Risks and the Banking System
The TAILOR Act of 2025 would direct banking regulators — including the Federal Reserve, the Office of the Comptroller of the Currency, the Consumer Financial Protection Bureau and the FDIC, among others — to “tailor” their regulations on an individual-by-individual institution basis. The legislation applies to “any proposed, interim, or final rule or regulation” and mandates that the agencies “tailor the regulatory action applicable to an institution, or type of institution, in a manner that limits the regulatory impact, including cost, human resource allocation, and other burdens, on the institution or type of institution as is appropriate for the risk profile and business model involved.”
The impact extends up and down financial supply chains, we note, which has implications for FinTechs, and would cover “the potential impact that efforts to implement the regulatory action” might also have on “third-party service provider actions.”
Separately, the Financial Institution Regulatory Tailoring Enhancement Act increases the asset threshold for banks that would be regulated by these agencies. The threshold would be raised to apply in-place leverage and risk based capital requirements to financial institutions with assets of more than $50 billion on the balance sheet.
Finally, the Bank Failure Prevention Act would seek to streamline the merger review process, where the Federal Reserve would have three days to weigh in on merger applications. The legislation states, “In the event of the failure of the Board to act on any application for approval under this section within the ninety-one-day period which begins on the date of submission to the Board of the complete record on that application, the application shall be deemed to have been granted” and adds that “In determining whether the record on an application is complete, the Board may take into account only information provided by the applicant, and may not base the determination of the Board on any information (including reports, views, or recommendations) provided by third parties.”
