HR 3234 United States House · 119th Congress

Keeping Deposits Local Act

HR 3234, the "Keeping Deposits Local Act," amends the Federal Deposit Insurance Act to adjust how banks calculate reciprocal deposits that don't count as "funds obtained through a deposit broker." It establishes tiered percentage thresholds based on a bank's total liabilities: 50% for banks under $1 billion, decreasing to 40% for $1-10 billion, 30% for $10-250 billion, 20% for $250 billion-$1 trillion, and 2% for banks over $1 trillion. This change directly affects commercial banks, particularly smaller institutions, by allowing them to hold a larger share of deposits without triggering stricter broker-related regulations. The bill aims to simplify compliance for community banks while maintaining oversight for larger financial institutions.

Bill status passed 3 of 5 stages cleared

Introduction

May 2025

Committee Review

May 2026

House Passage

May 2026

Senate Passage

President

Introduced May 7, 2025 Last action May 21, 2026

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What changed between versions

Introduced in House → Engrossed in House · 5 edits · May 20, 2026

MODERATE

The engrossed version of HR 3234 removes the two highest tiers of reciprocal deposit exemptions for banks with total liabilities above $250 billion, adds a short title (Keeping Deposits Local Act), requires the FDIC to conduct a study on reciprocal deposits within 6 months of enactment, and makes a small reduction to the Federal Reserve's Discretionary Surplus Fund effective in 2036. The most significant policy change is capping the reciprocal deposit exemption at $250 billion in total liabilities, meaning large banks can no longer shelter any portion of reciprocal deposits above that threshold from brokered-deposit treatment.

Scope change

The bill's scope narrowed for large banks: reciprocal deposits above $250 billion in total liabilities are no longer exempt from brokered-deposit treatment. The bill also expanded in scope by adding a mandatory FDIC study and a small Federal Reserve funding adjustment.

SCOPE

Removed two tiers of reciprocal deposit exemptions: 20 percent of liabilities between $250 billion and $1 trillion, and 2 percent of liabilities above $1 trillion. Banks with total liabilities exceeding $250 billion can no longer exclude any portion of their reciprocal deposits from being treated as brokered deposits.

Added a short title: 'Keeping Deposits Local Act.'

DEFINITION

Clarified the CAMELS rating requirement for agent institutions by adding 'under the Uniform Financial Institutions Rating System (or an equivalent rating under a comparable rating system)' to the existing language.

REQUIREMENT

Added a requirement for the FDIC, in consultation with the Federal Reserve Board, to conduct a study on reciprocal deposits and report findings to Congress within 6 months of enactment. The study must cover performance since 2018, usage by institution size, stress periods, end-user demand, comparison to other deposit arrangements, and benefits and risks.

FISCAL

Added a provision reducing the dollar amount under section 7(a)(3)(A) of the Federal Reserve Act (Discretionary Surplus Fund) by $28 million, effective September 1, 2036.

Floor votes · House May 20, 2026

How they voted

405–0

Passed · 25 other

Total votes 430

May 20, 2026

D Democratic212

204 Yea 8

96% Yea

I Independent1

1 Yea

100% Yea

R Republican217

200 Yea 17

92% Yea

Vote distribution

All Yea All Nay Mixed No data

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

May 21, 2026

Committee

Received in the Senate and Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

upper

May 20, 2026

Introduced

On motion to suspend the rules and pass the bill, as amended Agreed to by the Yeas and Nays: (2/3 required): 405 - 0 (Roll no. 177).

lower

May 20, 2026

Lower · Passed

Passed/agreed to in House: On motion to suspend the rules and pass the bill, as amended Agreed to by the Yeas and Nays: (2/3 required): 405 - 0 (Roll no. 177).

lower

May 19, 2026

Introduced

Mr. Hill (AR) moved to suspend the rules and pass the bill, as amended.

lower

Nov 4, 2025

Lower · Passed

Reported (Amended) by the Committee on Financial Services. H. Rept. 119-362.

lower

Sep 16, 2025

Introduced

Ordered to be Reported (Amended) by the Yeas and Nays: 51 - 0.

lower

Sep 16, 2025

Lower · Passed

Committee Consideration and Mark-up Session Held

lower

May 7, 2025

Committee

Referred to the House Committee on Financial Services.

lower

May 7, 2025

Introduced

Introduced in House

lower

1 primary · 11 co-sponsors