This bill would change how federal bank examiners rate banks under the CAMELS system. It adds a new section to the Federal Financial Institutions Examination Council Act directing the Council to recommend changes to the Uniform Financial Institutions Rating System. The recommendations must: set clear, objective criteria for each CAMELS component; change how components are weighted to form a composite rating; either remove the management component or limit that component to objective governance and control measures; and require composite ratings to use a transparent method based only on the objective criteria. After the Council makes recommendations, the federal banking agencies must jointly write rules within 12 months. Those agencies must publish the proposed rules and allow at least 60 days for public comment. The bill also says these changes do not limit the agencies' authority to supervise or enforce safety and soundness rules. Separately, the bill edits a phrase in the Bank Holding Company Act's definition of "well managed," replacing a longer phrase with the words "achievement of a CAMEL" and removing a clause identified as clause (ii).
If this bill becomes law, regulators must create and publish objective measures and weights for CAMELS ratings and complete rulemaking on that work. How those new rules would affect any particular bank, customer, or other person depends on the specific rules the agencies later write. No publicly available information describes specific, concrete effects today.
The bill requires federal agencies to prepare recommendations and then jointly issue rules, including a public comment process. No publicly available information in the bill text provides cost estimates for the federal government, regulators, banks, or other parties.
The bill text says CAMELS ratings are important for judging bank safety and for regulatory decisions. It states examiners now rely heavily on judgment, which can create subjective and inconsistent ratings across similar banks. The bill argues that clear, objective measures and set weights would promote fairness, consistency, and accountability, and that supervision should focus on a bank's core financial condition or solvency.
No publicly available information in the bill text presents opponents' views or specific objections.