Monthly LRA Update: April 2025
Monthly LRA Update: April 2025
TAX DEVELOPMENTS
House Ways and Means May Soon Vote on Tax Bill
On April 24 Ways and Means Committee Chaiman Jason Smith (MO) and Tax Subcommittee Chairman Mike Kelly (PA) announced the formation of ten Committee Tax Teams to study key tax provisions from the 2017 Trump tax cuts that are set to expire.
On April 29 House Speaker Mike Johnson told reporters that the House Ways and Means Committee is on schedule to vote on a tax bill “next week.”
We have yet to see any proposed legislative text. We will monitor closely as activity is expected to pick up in May.
REGULATORY DEVELOPMENTS
FRB Requests Comment on Proposal to Reduce Volatility of Capital Requirement Stemming from Stress Tests
On April 17 the Federal Reserve Board requested comment on a proposal to reduce the volatility of capital requirements resulting from the Board’s annual stress tests. The two primary areas addressed in this proposal are
- Averaging stress test results over two consecutive years; and
- Delaying the effective date of the stress capital buffer requirement from October 1 to January 1, allowing banks more time to adjust to new capital requirements.
The proposed changes are not intended to materially impact overall capital levels.
This proposal is the first action following the Board’s December announcement committing to broad changes to the stress testing framework. The Board also plans to disclose and seek public comment on the models and scenarios used in the annual stress test later this year.