Legislation authored by Rep. Sheryl Delozier, R-Cumberland, to strengthen the independence of Pennsylvania's banking fund unanimously passed in the house.
“House Bill 859 would prevent state government from accessing dedicated revenue in order to balance budgets,” Delozier said in a news release.
The new legislation would change both the Banking Fund and the Institution Resolution Account to Trust Funds to pay for the regulation and oversight of the industry and protect the consumer in the case of a failure.
State-chartered banks and credit unions make payments twice a year to the Department of Banking & Securities, which are then deposited into the Banking Fund. The fund can be used to pay for state-chartered operations or to take control of or liquidate a financially distressed non-federally insured institution.
Two transfers have been made from the Banking Fund in the past 18 months. About $40 million dollars was transferred to the general fund and to supplement the budgets of the Department of Conservation and Natural Resources and the Department of Environmental Protection.
“The changes made by House Bill 859 would work to keep our banking industry regulated appropriately, without taxpayer dollars, while allowing the institutions to remain good community partners, as they were this past year administering millions of dollars to our small businesses through the federal loan programs during the COVID-19 pandemic,” Delozier said.
HB859 is awaiting action in the Senate Banking and Insurance Committee.
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