This act mandates federal financial regulators to provide Congress with annual, detailed reports and timely updates on their activities and positions within the international Basel Committee on Bank Supervision.
John Kennedy
Senator
LA
The Transparency in Banking Act mandates that key federal financial regulators submit a detailed annual report to Congress regarding their planned activities and positions at the international Basel Committee on Bank Supervision meetings. This legislation requires public disclosure of agency attendance, proposed solutions, and potential new standards affecting U.S. interests. Furthermore, regulators must promptly update Congress on any significant changes to their planned engagement and include this information in required testimony.
New 'Transparency in Banking Act' Forces Fed, FDIC to Detail Global Banking Rule Plans to Congress Annually
The new Transparency in Banking Act isn’t about changing interest rates or setting up new banks. Instead, it’s a procedural bill designed to pull back the curtain on how U.S. financial regulators—like the Federal Reserve, the FDIC, and the OCC—operate on the international stage. Specifically, it targets their involvement with the Basel Committee on Bank Supervision, the global group that sets the standards for how banks worldwide manage risk. Starting now, these agencies must produce a joint, detailed report annually for Congress and the public by January 31st, outlining exactly what they plan to talk about and push for at these international meetings.
Who’s Talking for the U.S. and Why It Matters
Think of the Basel Committee as the global standard-setter for financial plumbing. When they change a rule, it eventually trickles down and affects how much capital your local bank has to hold, which ultimately influences how easy or hard it is to get a mortgage or a business loan. This bill (Sec. 2) mandates that the annual report must detail who from the U.S. agencies is attending, the specific problems they plan to tackle, and what new standards they are considering that might impact U.S. consumers or businesses. It also requires them to specify the legal authority they plan to use if they decide to implement those international standards here at home. This is a big deal because it forces the regulators to show their homework before they go to the international meeting, giving Congress a chance to weigh in.
No More Surprises: The 30-Day Update Rule
In the real world, plans change. If the U.S. regulators shift their strategy or position on a major issue after submitting their annual report, the agencies can’t just keep quiet. The Act requires them to update Congress within 30 days of any significant change. This update must include the results of the meetings, a summary of how U.S. representatives voted, and the specific stance taken by each agency. This prevents regulators from making major international commitments and then dropping them on Congress as a done deal months later. For busy people, this means that if a new global rule is coming that could affect your 401(k) or your ability to finance a car, there’s now a clear, mandated paper trail.
Bringing the Conversation Home
Finally, the bill ties this international activity directly into domestic accountability. The Federal Reserve Board Chair and the Vice Chair for Supervision are already required to testify before the Senate and House financial committees every year. This Act now requires them to include all the details from the annual Basel report in that testimony. Essentially, they can no longer skip over the international policy work when answering questions from lawmakers. While this bill mostly creates administrative work for the regulatory agencies (the negatively impacted group, as they now have a lot more reporting to do), the public benefits from the increased transparency. It’s a procedural win for oversight, ensuring that the people making global rules that affect our money have to explain themselves clearly and publicly.