Office of the Comptroller of the Currency

Capital: Notice of Proposed Rulemaking

 

On December 17, three entities – the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency – “published a notice of proposed rulemaking [] to provide an updated framework for measuring derivative counterparty credit exposure.” Release.

Agencies Propose Rule to Update Calculation of Derivative Contract Exposure Amounts Under Regulatory Capital Rules

 

On October 30, the Federal Reserve Board, the Federal Depository Insurance Corporation and the Office of the Comptroller of the Currency (collectively, the “Agencies“) proposed changes to their standards for how large federal institutions measure counterparty credit risk posed by derivatives contracts under the Agencies’ regulatory capital rules. The proposal would provide the “standardized approach for measuring counterparty credit risk” as an alternative approach to the Agencies’ current exposure methodology for calculating derivative exposure. Release.

Federal Agencies Issue a Joint Statement on Banks and Credit Unions Sharing Resources to Improve Efficiency and Effectiveness of Bank Secrecy Act Compliance

 

On October 3, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the National Credit Union Administration, the Office of the Comptroller of the Currency and the U.S. Department of the Treasury’s Financial Crimes Enforcement Network issued a statement to address instances in which certain banks and credit unions may decide to enter into collaborative arrangements to share resources to manage their Bank Secrecy Act and anti-money laundering obligations more efficiently and effectively. Joint Statement.

Federal Banking Agencies Issue Final Rule to Exempt Commercial Real Estate Transactions of $500,000 or Less from Appraisal Requirements:

 

On April 2, 2018, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency issued a final rule that increases the threshold for commercial real estate transactions requiring an appraisal from $250,000 to $500,000. Press Release. Rule.

New York Regulator’s Fintech-Charter Lawsuit Dismissed

On December 12, 2017, a federal judge in Manhattan dismissed a state regulator’s lawsuit challenging the Office of the Comptroller of the Currency’s (“OCC“) federal-fintech-charter effort, finding that legal challenges to the initiative were premature. In an order filed Tuesday, the judge found that the lawsuit filed in May by New York’s Superintendent for Financial Services Maria Vullo lacked merit, because the OCC’s initiative hasn’t been implemented yet. To view the full article, click here.

Federal Banking Agencies Finalize an 18-Month Examination Cycle for Small Banking Institutions

On December 12, 2016, the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board and the Office of the Comptroller of the Currency (OCC) finalized rules that generally allow well-capitalized and well-managed banks and savings associations with less than $1 billion in total assets to benefit from an 18-month examination cycle rather than a 12-month cycle.  Prior to the adoption of the interim final rules, only firms with total assets of less than $500 million were eligible to benefit from the extended 18-month cycle.  The final rules are meant, among other things, to reduce regulatory compliance costs for smaller institutions. Press Release. Final Rule.

Agencies Issue Advanced Notice of Proposed Rulemaking on Enhanced Cyber Risk Management Standards

 

On October 19, 2016, the Federal Reserve Board, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency announced proposed rules relating to cybersecurity and risk management concerns that would apply to larger institutions under their purview. FDIC Press Release. Federal Reserve Press Release. OCC Press Release.

The OCC Publishes Guidance Concerning Foreign Correspondent Banking Accounts

 

On October 5, 2016, the Office of the Comptroller of the Currency (the “OCC”) issued risk management guidance that addresses periodic reevaluations of risks associated with foreign correspondent banking accounts. The guidance includes the OCC’s best practices for banks to consider when conducting reevaluations and making account termination and retention decisions. Press Release.

The OCC Proposes Rule to Address Concerns Relating to Exercise of Default Rights Under Qualified Financial Contracts

 

On October 3, 2016, the Office of the Comptroller of the Currency proposed a rule to enhance the resilience of federally chartered and licensed financial institutions. The proposed rule addresses concerns relating to the exercise of default rights under certain financial contracts that could interfere with the orderly resolution of systemically important financial firms. The rule requires, among other things, covered banks to ensure that covered qualified financial contracts (i) limit the exercise of default rights based on the insolvency of an affiliate of a covered bank and (ii) contain contractual stay-and-transfer provisions analogous to the statutory stay-and-transfer provision set forth under title II of the Dodd-Frank Act and the Federal Deposit Insurance Act. Comments on the proposed rule are due on October 18, 2016. Press Release.