“Rep. Hill Rolls Out Community Bank Deregulation Package”
HFSC Chair French Hill, R-AK, and Rep. Andy Barr, R-KY, introduced a legislative package Wednesday aimed at easing regulatory burdens on community banks by narrowing or removing the “management” component of bank exams, barring examiners from using reputational risk, and revising the definition of brokered deposits, among other measures. Hill said the bill is intended to more firmly codify the tailoring framework established in the 2018 S. 2155 law and limit future policy reversals.
Separately, during a speech to the California Bankers Association, Fed Vice Chair Michelle Bowman called for a reset in bank supervision, arguing exams should focus narrowly on material safety-and-soundness risks and pledging greater transparency and risk prioritization.
“Trump-Linked Crypto Company Applies for Federal Banking Charter”
World Liberty Financial filed an application with the OCC to establish a national trust bank to issue, redeem, custody, and convert its USD1 stablecoin under a single federal charter, positioning the firm to operate under the new GENIUS Act stablecoin framework.
Meanwhile, Politico’s Morning Money reports that large bank executives are bracing for intensifying policy fights over crypto—particularly over whether exchanges should be allowed to pay a yield—as Congress and regulators debate stablecoins, custody, and banks’ involvement in digital assets.
“Agentic AI in Banking Will Follow Three Tracks. Fintechs Lead in All of Them”
Banks are capturing AI gains primarily through back-office efficiency, while fintechs are reshaping financial services by rebuilding experiences, interfaces, and customer relationships around autonomous agents, a new report found. The article predicts that the future leaders of financial services will be institutions that scale all three dimensions of agentic AI simultaneously.
Speaking of AI, criminals are using it to scale fraud and impersonation schemes, prompting banks and card issuers to rely more heavily on analytics, monitoring, and verification tools.
Finally, JPMorgan Chase has ended its use of third-party proxy advisors and is shifting to an in-house, AI-powered platform for voting recommendations.
“Raising The FDIC Limit Risks Repeating The S&L Crisis”
Raising deposit insurance limits could encourage greater risk-taking by banks and weaken market discipline, argue former HFSC Chair Jeb Hensarling and Hudson Institute Senior Fellow Michael Solon in this Wall Street Journal op-ed. They contend that higher coverage would shift more risk to taxpayers and draw parallels to policy choices that preceded the savings and loan crisis.
“Looking Ahead: The Lending Landscape for 2026”
Community banks enter 2026 with a generally positive lending outlook, supported by improved earnings, stronger net interest margins, and solid capital levels. At the same time, bankers report heightened attention to credit quality, consumer delinquencies, and agricultural borrowers, emphasizing disciplined underwriting and relationship-based lending amid ongoing uncertainty.
“4 Banking Trends to Watch in 2026”
Review Banking Dive’s key themes to monitor in the year ahead.
In Other News
Automating routine tasks may have hidden downsides, why the U.S. really, really wants access to Venezuelan crude oil, and The Simpsons said goodbye to Duffman after nearly three decades.