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119-hr-6547119th CongressWALLET

Least Cost Exception Act

Sponsored By: Representative Flood, Mike [R-NE-1]

In Committee

Summary

Allow FDIC to pick a non‑least‑cost resolution to limit concentration in global systemically important banks (G‑SIBs). This bill would create a narrow exception letting the FDIC, after consulting the Federal Reserve and the Treasury, accept a higher short‑term cost to the Deposit Insurance Fund if that cost is outweighed by benefits that reduce concentration in G‑SIBs.

Show full summary
  • FDIC and DIF: Would let the FDIC choose an alternative that is not the least costly if the Fed and Treasury agree the benefits of limiting G‑SIB concentration outweigh added risk. The FDIC must set a maximum allowable cost by rule within 1 year.
  • Buyers of assets or deposits: If a purchaser acquires assets or assumes deposit liabilities under the exception it must pay an assessment spread over at least 5 years to cover the added DIF cost, with the FDIC setting the discounting rules.
  • Oversight and transparency: The FDIC must report to House and Senate banking committees within 30 days after using the exception and explain the economic difference versus the least‑cost option.

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Bill Overview

Analyzed Economic Effects

1 provisions identified: 0 benefits, 0 costs, 1 mixed.

FDIC could favor smaller bank buyers

This bill would let the FDIC pick a resolution that is not the cheapest for the Deposit Insurance Fund in some failed-bank cases. The FDIC and the Federal Reserve would have to jointly find, after consulting Treasury, that limiting big global banks is worth the extra DIF risk. The chosen option would have to be the cheapest among alternatives that do not involve a large global bank and must not cost more than liquidation. FDIC would have to write a rule within one year capping allowable DIF charges and set rules for calculating purchaser assessments. If a buyer takes assets or deposits, that buyer would need to pay an assessment equal to the DIF cost difference, paid over at least five years under FDIC rules. FDIC would follow existing FDIA cost accounting and would report to two congressional committees within 30 days after using the exception.

Sponsors & CoSponsors

Sponsor

Flood, Mike [R-NE-1]

NE • R

Cosponsors

  • Rep. Foster, Bill [D-IL-11]

    IL • D

    Sponsored 12/16/2025

  • Rep. Rose, John W. [R-TN-6]

    TN • R

    Sponsored 12/16/2025

  • Rep. Moskowitz, Jared [D-FL-23]

    FL • D

    Sponsored 12/18/2025

  • Rep. Lawler, Michael [R-NY-17]

    NY • R

    Sponsored 1/12/2026

Roll Call Votes

No roll call votes available for this bill.

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