Financial Stability Oversight Council Improvement Act of 2025

**What Happened**: HR 3682 was introduced June 3, 2025, by Rep. Foster (D-IL) with Rep. Huizenga (R-MI) as original cosponsor. It passed the House on February 9, 2026 via suspension of the rules (417-4 vote). The bill amends Section 113 of the Financial Stability Act of 2010 to require FSOC to first determine that 'a different action by the Council or the agency (including the application of new or heightened standards and safeguards under section 120), or by the company under a written plan that is submitted promptly to the Council, is impracticable or insufficient to mitigate the threat' before voting on a designation. An identical companion bill (S3578) has been referred to the Senate Banking Committee. This is early-stage — the bill has cleared the House but requires Senate passage and President signature to become law. **The Money Trail**: This bill does not authorize or appropriate any federal spending. The financial impact is entirely regulatory — by raising the procedural bar for SIFI designations, it reduces compliance costs and capital requirements for large nonbank financial firms. The Congressional Budget Office would likely score the bill as having no direct spending impact (CBO typically scores regulatory process changes as zero cost/revenue absent analytic capacity). The indirect market impact is significant: firms avoid Fed-imposed capital surcharges (typically 1-5% of risk-weighted assets), stress testing costs ($10M-$100M+ annually for large firms), and enhanced prudential standards that constrain business models. **Structural Winners**: Blackstone (BX) is the clearest beneficiary — as the largest alternative asset manager and a frequent target of FSOC scrutiny, the bill directly protects its business model. Berkshire Hathaway (BRK-B) benefits across its insurance and financial subsidiaries. PayPal (PYPL), Visa (V), and Mastercard (MA) face lower regulatory tail risk despite their payments network scale. The market data shows mixed recent performance: BX is down ~5% over the past week (from $129.08 on 4/17 to $123.07 on 4/30) but up 7% over 30 days — the regulatory relief may be partially priced in given the House passage in February. V and MA show divergent 7-day trends: V up 6.39% (from $309.65 on 4/27 to $329.20 on 4/30) while MA is down slightly, reflecting sector rotation more than specific bill momentum. **Timeline**: The path to law requires Senate Banking Committee consideration (chairman Tim Scott, R-SC), full Senate vote, and President signature. The identical companion bill (S3578) is at an early stage (referred to committee). With the 119th Congress running through January 2027, the bill has ~9 months of legislative runway. Bipartisan House support (417-4) and bipartisan sponsorship (Foster-D, Huizenga-R) suggest reasonable passage odds, though Senate timing is uncertain given competing priorities.