The U.S. Senate Committee on Banking, Housing and Urban Affairs majority announced that Chairman Tim Scott and a bipartisan group of senators have introduced the Community Investment and Prosperity Act to increase the statutory limit on banks’ “public welfare” investments, aiming to expand private capital for affordable housing and other community development projects. Under the National Bank Act and the Federal Reserve Act, banks are generally limited to certain equity investments of up to 5% of capital and surplus, with the Office of the Comptroller of the Currency and the Federal Reserve able to raise the limit for an individual bank to 15% if the investment poses no significant risk to the Deposit Insurance Fund and other criteria are met. The bill would raise that cap from 15% to 20%, the first increase since 2006, and is positioned as supporting activities such as affordable housing, small business development, technical assistance, and financial literacy. KeyBank, the Bank Policy Institute, the Affordable Housing Tax Credit Coalition, and the National Association of Affordable Housing Lenders endorsed the legislation.
U.S. Senate Committee on Banking, Housing and Urban Affairs 2025-07-24
U.S. Senate Committee on Banking, Housing and Urban Affairs leaders introduce bill to lift banks’ public welfare investment cap to 20%
The U.S. Senate Committee on Banking, Housing and Urban Affairs introduced the Community Investment and Prosperity Act to raise the cap on banks' "public welfare" investments from 15% to 20% of capital and surplus. This increase, the first since 2006, aims to boost private capital for affordable housing and community development projects. The bill has received endorsements from KeyBank, the Bank Policy Institute, and other industry groups.