On July 4, President Trump signed the One Big Beautiful Bill Act (OBBBA) into law, concluding months of legislative brinkmanship and enacting a sweeping reconciliation package that overhauls tax, immigration, energy, education, and health care policy in a single measure. Importantly, the long‑standing federal tax exemption for credit unions survived intact; despite appearing in a House Ways and Means Committee “pay‑for” list, no language targeting that status was included in any version of the bill. Instead, principal revenue offsets came from repealing substantial Inflation Reduction Act clean energy incentives, restructuring Medicaid, and increasing the excise tax on large university endowments, among other changes.
Most financial services provisions were struck by the Senate Parliamentarian, but OBBBA still imposes a significant reduction in the Consumer Financial Protection Bureau’s budget: the cap on transfers from the Federal Reserve’s operating budget drops from 12% to 6.5%. For context, the CFPB drew $729.4 million in FY 2024 (of a possible $785.4 million); under the new limit, the ceiling would have been roughly $425 million. Earlier drafts varied widely: the House bill proposed a 5% cap, while the Senate initially sought to eliminate funding altogether before the parliamentarian ruled that approach non‑compliant with the Byrd Rule.
Although the statute permits the CFPB to request supplemental appropriations from Congress, additional funding is unlikely in the current political climate. Meanwhile, Acting CFPB Director Russell Vought has moved aggressively to curtail operations—directing staff to “stand down,” closing the Washington office, terminating contracts and probationary employees, and laying groundwork for a workforce reduction of up to 90%. These actions face ongoing legal challenges. Nonetheless, the Bureau continues to function: it recently rescinded 67 guidance documents issued under prior leadership, signaling an intent to pivot from regulation by press release, circular, or blog post toward formal rulemaking.
Additionally, the House Financial Services Committee held a hearing earlier this week examining the Dodd-Frank Act. The committee noticed dozens of bills with the hearing, including a suite of Consumer Financial Protection Bureau (CFPB) reform measures, which could be considered in an upcoming markup. During the hearing, a senior committee Democrat, Rep. Greg Meeks (D-NY) said that Congress should “get the politics out of” the CFPB, adding that he would be in favor of a bipartisan commission.
Moving to digital assets, the Senate-passed stablecoin bill, the GENIUS Act (S. 1582) is expected to pass the House on Thursday, amid internal Republican disagreements on the procedure for advancing additional digital asset bills. In June, the measure sailed through the Senate by a 68-30 bipartisan vote, winning 18 Democrats and losing only two Republicans. Under the bill, stablecoin issuers would be required to hold sufficient assets in reserve to guarantee that the tokens they issue maintain a fixed one-to-one dollar value. Issuers would also be required to issue monthly public reports disclosing key financial metrics regarding the composition of their portfolio of reserve assets as well as the number of stablecoin tokens outstanding, among many other provisions. The bill directs the Treasury Department and other regulators to launch a series of rulemakings to implement its provisions, each offering substantial opportunities for stakeholder input.
Shifting to the NCUA, President Trump’s April 17 dismissal of NCUA Board Members Todd Harper and Tanya Otsuka left Chairman Kyle Hauptman as the agency’s sole board member. In a staff message, the NCUA said existing Bush‑era delegations let one member serve as a quorum for meetings, rulemakings, and supervision, a stance now being tested in court: Harper and Otsuka sued the administration on April 28, calling their removal unlawful. Hauptman relied on that single‑member precedent to hold the first solo board meeting on May 22, where he announced a 24.1 % cut in positions and a 21.5 % reduction in headcount, with savings to be reinvested in regulatory technology and examiner training as part of a broader cultural reset.
Congressional Democrats have also challenged the arrangement. On June 20, Senate Banking Ranking Member Elizabeth Warren (D‑MA) and House Financial Services Ranking Member Maxine Waters (D‑CA) wrote Hauptman asking how the NCUA can lawfully conduct business with one board member, citing an Inspector General statement that neither the agency nor the White House has clarified its authority. They requested detailed answers by July 7.
On the efforts to expand NCUA’s direct regulatory and supervisory authority to third-party vendors, the Strengthening Cybersecurity for the Financial Sector Act has not yet been introduced in the House or Senate this Congress. Additionally, Chairman Hauptman is on record opposing the expansion of NCUA’s authority, stating in 2024 that he opposes third-party vendor authority for the NCUA and creating a “mini CFPB” at the agency.
Looking ahead, congressional attention turns to FY 2026 appropriations – as government funding runs dry on September 30. The House and Senate are also moving forward on the FY 2026 National Defense Authorization Act (NDAA), aiming to pass the legislation before the end of the year. Depending on the dynamics, the NDAA could be used as a vehicle for financial services and other non-defense policy items Additionally, some Republican lawmakers are floating a potential second party-line reconciliation bill targeting additional items that were left out of OBBBA.
