Banking Reforms, Homebuyer Savings Account Adopted

Lawmakers took significant steps this legislative session toward modernizing its financial landscape.

Two key legislative initiatives won approval in the session that adjourned June 4: banking regulatory reforms and the creation of a first-time homebuyer savings account. 

The General Assembly unanimously passed HB 6877 last month, a bill that reduces outdated regulatory burdens on small and medium-sized banks.

The legislation eliminates the requirement for these banks to seek Department of Banking approval for renovations exceeding $750,000 or 5% of their capital—whichever was less.

This change is expected to streamline operations, reduce administrative delays, and free up resources for banks to focus on core business activities. 

CBIA’s Pete Myers praised the bill as a collaborative effort between the banking industry and lawmakers, emphasizing that it reflects Connecticut’s commitment to cutting red tape and fostering a more business-friendly environment. 

Homebuyer Savings Account

In a parallel effort to address housing affordability and workforce challenges, lawmakers also approved a CBIA proposal for a first-time homebuyers savings account.

The measure establishes tax-advantaged savings accounts for first-time homebuyers, allowing them to deduct contributions from state income taxes and earn tax-free interest, provided funds are used for qualifying home purchase expenses. 

The program is modeled after similar successful efforts in 23 other states and is seen as both a housing and workforce development tool.

By making homeownership more accessible, especially for young professionals, the proposal helps attract and retain talent in Connecticut’s competitive labor market. 

CBIA supports this initiative as a strategic investment in the state’s economic future.

Myers noted that the bill addresses two critical issues: high homeownership costs and the labor shortage, helping position Connecticut as a more attractive place to live and work. 

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For more information, contact CBIA’s Pete Myers (860.244.1921).