S. 113

Promoting New Bank Formation Act of 2025 This bill eliminates and reduces certain requirements applicable to new financial institutions, certain rural community banks, and federal savings associations. Under the bill, federal banking agencies must issue rules allowing new financial institutions to meet capital requirements within three years. During this period, a financial institution may request to deviate from an approved business plan and the appropriate agency has 30 days to approve or deny the request. In addition, the community bank leverage ratio—a way of evaluating debt levels—is reduced for new rural community banks. Specifically, new rural community banks must have a ratio of 8%, with a three-year phase-in of the rate. After this period, the ratio rises to its current level of 9%. Finally, the bill removes certain restrictions to allow federal savings associations to invest in, sell, or otherwise deal in agricultural loans.