Washington, D.C. (May 21, 2025) | Rep. Barry Loudermilk (GA-11) issued the following statement after the House Committee on Financial Services passed his TAILOR Act (H.R. 3380):
“In 1776 Thomas Paine wrote, ‘…government, even in its best state, is but a necessary evil; in its worst state an intolerable one…’ For many small businesses, trying to comply with droves of complex government regulations has become an intolerable evil, especially for our small community banks. Georgia has lost more banks than any other state, due to the overwhelming cost of government compliance.
“While big banks have an abundance of lawyers and compliance specialists to comply with the myriad of federal regulations, small firms struggle to meet these complex and often conflicting regulations. Small banks tell me that trying to comply with one-size-fits-all regulations is like a slow and painful death by a thousand cuts.
“This is why I introduced the TAILOR Act, which will require federal regulators to tailor their regulations in accordance with the size, business model, and risk of each type of firm that they regulate. This will allow these smaller banks and financial institutions to operate more efficiently, without fear of succumbing to the pressures of overly burdensome government regulations that were designed for big banks and larger financial institutions.”
Background
• This bill would require federal financial regulators to tailor the scope of their regulations to fit the risk profiles of individual business models.
• Currently, most regulatory tailoring is done by asset value. This has the unintended consequence of deterring banks from passing key milestones due to the new regulatory requirements that would kick in on the other side, thus slowing healthy growth.
• Risk-based tailoring is a much more customized approach, allowing banks to take healthy risks and truly innovate. Because the financial services industry can’t ‘innovate’ in the same way that a factory might innovate, by inventing a new and faster machine or process, much of the innovation depends on adopting new business models.
Click here to read full bill text