TIER Act of 2025
Introduced December 10, 2025 · Last action February 25, 2026
Plain English Summary
This bill raises the dollar thresholds that trigger federal banking regulations for large financial institutions. It increases thresholds for 'systemically important' banks from $250 billion to $370 billion in assets and smaller thresholds proportionally, and then requires automatic adjustments every 5 years based on GDP growth to keep the thresholds from eroding in real terms.
Who benefits
Large bank holding companies (those with $10-15 billion in assets moving out of enhanced regulatory requirements), systemically important financial institutions (those with $250-370 billion in assets moving out of SIFI designation and stress testing requirements), regional and midsize banks ($50-75 billion range moving out of enhanced prudential standards), asset managers and financial firms that manage assets below the newly raised thresholds.
Who pays / loses
Federal regulators (Board of Governors, Comptroller of the Currency, FDIC) who must conduct reviews and adjustments every 5 years; potentially consumers and depositors at systemically important institutions who may face reduced regulatory oversight of systemic risk; taxpayers who subsidize institutions deemed 'too big to fail' if regulatory gaps emerge; smaller financial institutions and non-bank competitors who may face relative competitive disadvantages as larger institutions face less regulation.
Funding & Lobbying Interests
Large bank holding companies and regional banks with $10-370 billion in assets—particularly those currently subject to Dodd-Frank Title I stress testing, enhanced capital requirements, and liquidity standards. The financial services industry, represented by banking trade associations, has lobbied for years to raise thresholds and reduce compliance burdens; sponsor Rep. Andy Barr represents Kentucky and has received substantial campaign contributions from the banking and financial services sector. The Bank Policy Institute and American Bankers Association have advocated for exactly this type of threshold indexing to inflation and GDP growth.
Political Impact
Affected Groups
Mid-to-large regional and community banks (those with $50-370 billion in assets) will face substantially reduced regulatory compliance costs and reporting requirements. Approximately 8-12 banks currently designated as SIFIs would move out of that category if this bill passes, reducing their stress-testing and enhanced prudential obligations. Consumers and depositors at these institutions may face changed deposit insurance protections and systemic risk oversight. The Federal Reserve and banking regulators face mandate to conduct reviews every 5 years indefinitely.
Political Subtext
Proponents argue that post-2008 regulatory thresholds have not kept pace with inflation and GDP growth, imposing outdated compliance costs on banks that do not pose systemic risk, and that automatic indexing prevents regulatory creep. Critics counter that the 2008 financial crisis demonstrated that mid-sized institutions ($250+ billion) can pose systemic risk and that raising thresholds weakens the 'guardrails' that prevent another financial crisis. Non-partisan evidence (CBO, Federal Reserve economists) documents that compliance costs exist but debate centers on whether thresholds correctly target systemic risk. The premise that current thresholds are 'outdated' conflicts with regulatory agency testimony that thresholds remain appropriate; no independent analysis provided in bill text justifies the specific new threshold amounts ($370 billion vs. $250 billion).
Real-World Stakes
If this passes, approximately 8-12 banks would exit SIFI status immediately, eliminating company-run stress tests, Federal Reserve-directed capital planning, and heightened liquidity and leverage requirements for those institutions. The Dodd-Frank Act (2010) established the $250 billion threshold specifically because institutions of that size were central to the 2008 crisis; moving that threshold to $370 billion would exclude banks larger than Regions Bank and Truist Bank—both systemically significant regional institutions. The 2008 financial crisis originating partly in non-SIFI banks demonstrates historical precedent for risk outside the SIFI perimeter. Automatic indexing means thresholds would rise passively without Congressional debate or agency reassessment of whether risk profiles justify higher thresholds. No cost-benefit analysis in the bill quantifies the fiscal impact or systemic risk implications of reduced oversight.
What's Inside This Bill
Non-obvious provisions not apparent from the headline summary.
Automatic Threshold Adjustment Without Congressional Review
The bill mandates automatic adjustments to asset thresholds every 5 years based on GDP growth without requiring new legislative action or congressional approval, making the changes self-executing and effectively delegating regulatory authority to an automated formula.
AffectsFinancial institutions near the adjusted thresholds will automatically transition into or out of regulatory categories without legislative oversight; Congress loses its ability to debate or reject specific threshold changes; smaller banks approaching the threshold have less predictability since adjustments are predetermined by formula rather than deliberative process.
Potential Preemption of State Banking Regulation
By raising the federal threshold for 'systemically important' designation, banks that were previously regulated under both federal and state enhanced scrutiny standards may fall below the federal threshold, potentially reducing state regulatory authority over what were previously considered large state-regulated institutions.
AffectsState banking regulators lose authority over institutions that exit federal 'systemically important' status; community banks and regional banks may face reduced oversight if they previously relied on state-level capital and liquidity requirements that aligned with federal standards.
Grandfather Clause or Retroactive Application of New Thresholds
The bill language does not clarify whether institutions currently above the $250 billion threshold remain subject to enhanced regulations if they shrink below the new $370 billion threshold, or whether existing rules instantly cease applying once they cross below.
AffectsLarge financial institutions could strategically shed assets to move below the new $370 billion threshold and immediately escape enhanced regulatory requirements; depositors and creditors at institutions that shrink below thresholds may lose protections previously afforded by enhanced regulation.
Sponsor
Co-sponsors (7)
RRep. Moore, Tim [R-NC-14]RRep. Nunn, Zachary [R-IA-3]RRep. Sessions, Pete [R-TX-17]RRep. Salazar, Maria Elvira [R-FL-27]RRep. Williams, Roger [R-TX-25]RRep. Meuser, Daniel [R-PA-9]RRep. Lucas, Frank D. [R-OK-3]
Vote Record
No recorded votes.
Campaign Finance — Primary Sponsor
Top contributing industries
Other$108,381.12
Finance$36,700
Agriculture$24,120.95
Law$10,900
Transportation$9,100
501(c)(4) disclosure: Contributions from 501(c)(4) "dark money" organizations are not required to be publicly disclosed and are not reflected in the figures above. Data sourced from FEC public disclosure filings.
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