Proposed Rule2025-20204
Community Bank Licensing Amendments
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
November 18, 2025
Issuing agencies
Treasury DepartmentComptroller of the Currency
Abstract
The Office of the Comptroller of the Currency (OCC) is proposing to amend its rules related to policies and procedures to simplify licensing requirements for corporate activities and transactions involving national banks and Federal savings associations that have less than $30 billion in total assets and satisfy certain conditions. The proposed rule is intended to reduce burden on these institutions.
Full Text
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<title>Federal Register, Volume 90 Issue 220 (Tuesday, November 18, 2025)</title>
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[Federal Register Volume 90, Number 220 (Tuesday, November 18, 2025)]
[Proposed Rules]
[Pages 51577-51583]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-20204]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
12 CFR Part 5
[Docket ID OCC-2025-0273]
RIN 1557-AF38
Community Bank Licensing Amendments
AGENCY: Office of the Comptroller of the Currency, Treasury.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The Office of the Comptroller of the Currency (OCC) is
proposing to amend its rules related to policies and procedures to
simplify licensing requirements for corporate activities and
transactions involving national banks and Federal savings associations
that have less than $30 billion in total assets and satisfy certain
conditions. The proposed rule is intended to reduce burden on these
institutions.
DATES: Comments must be received by January 20, 2026.
ADDRESSES: Commenters are encouraged to submit comments through the
Federal eRulemaking Portal. Please use the title ``Community Bank
Licensing Amendments'' to facilitate the organization and distribution
of the comments. You may submit comments by any of the following
methods:
<bullet> Federal eRulemaking Portal--<a href="http://Regulations.gov">Regulations.gov</a>:
Go to <a href="https://regulations.gov/">https://regulations.gov/</a>. Enter Docket ID ``OCC-2025-0273''
in the Search Box and click ``Search.'' Public comments can be
submitted via the ``Comment'' box below the displayed document
information or by clicking on the document title and then clicking the
``Comment'' box on the top-left side of the screen. For help with
submitting effective comments, please click on ``Commenter's
Checklist.'' For assistance with the <a href="http://Regulations.gov">Regulations.gov</a> site, please call
1-866-498-2945 (toll free) Monday-Friday, 9 a.m.-5 p.m. EST, or email
<a href="/cdn-cgi/l/email-protection#67150200120b06130e0809140f020b170302140c2700140649000811"><span class="__cf_email__" data-cfemail="295b4c4e5c45485d4046475a414c45594d4c5a42694e5a48074e465f">[email protected]</span></a>.
<bullet> Mail: Chief Counsel's Office, Attention: Comment
Processing, Office of the Comptroller of the Currency, 400 7th Street
SW, Suite 3E-218, Washington, DC 20219.
<bullet> Hand Delivery/Courier: 400 7th Street SW, Suite 3E-218,
Washington, DC 20219.
Instructions: You must include ``OCC'' as the agency name and
Docket ID ``OCC-2025-0273'' in your comment. In general, the OCC will
enter all comments received into the docket and publish the comments on
the <a href="http://Regulations.gov">Regulations.gov</a> website without change, including any business or
personal information provided such as name and address information,
email addresses, or phone numbers. Comments received, including
attachments and other supporting materials, are part of the public
record and subject to public disclosure. Do not include any information
in your comment or supporting materials that you consider confidential
or inappropriate for public disclosure.
You may review comments and other related materials that pertain to
this action by the following method:
<bullet> Viewing Comments Electronically--<a href="http://Regulations.gov">Regulations.gov</a>:
Go to <a href="https://regulations.gov/">https://regulations.gov/</a>. Enter Docket ID ``OCC-2025-0273''
in the Search Box and click ``Search.'' Click on the ``Dockets'' tab
and then the document's title. After clicking the document's title,
click the ``Browse All Comments'' tab. Comments can be viewed and
filtered by clicking on the ``Sort By'' drop-down on the right side of
the screen or the ``Refine Comments Results'' options on the left side
of the screen. Supporting materials can be viewed by clicking on the
``Browse Documents'' tab. Click on the ``Sort By'' drop-down on the
right side of the screen or the ``Refine Results'' options on the left
side of the screen checking the ``Supporting & Related Material''
checkbox. For assistance with the <a href="http://Regulations.gov">Regulations.gov</a> site, please call 1-
866-498-2945 (toll free) Monday-Friday, 9 a.m.-5 p.m. EST, or email
<a href="/cdn-cgi/l/email-protection#37455250425b56435e5859445f525b475352445c7750445619505841"><span class="__cf_email__" data-cfemail="5a283f3d2f363b2e33353429323f362a3e3f29311a3d293b743d352c">[email protected]</span></a>.
The docket may be viewed after the close of the comment period in
the same manner as during the comment period.
FOR FURTHER INFORMATION CONTACT: Christopher Crawford, Special Counsel,
or Scott Burnett, Counsel, Chief Counsel's Office, 202-649-5490, Office
of the Comptroller of the Currency, 400 7th Street SW, Washington, DC
20219. If you are deaf, hard of hearing, or have a speech disability,
please dial 7-1-1 to access telecommunications relay services.
SUPPLEMENTARY INFORMATION:
I. Background
Twelve CFR part 5 sets forth the OCC's requirements for national
banks and Federal savings associations that seek to engage in certain
corporate activities and transactions, including establishing, changing
the structure of or the activities performed by, and dissolving OCC-
supervised institutions. The filing requirements differ depending on
the nature of corporate activity or transaction, ranging from a full
application before engaging in an activity or transaction to an after-
the-fact notification for informational purposes.
While all similarly categorized corporate activities and
transactions are generally subject to identical filing requirements,
the OCC's licensing regulations provide expedited review of filings and
modified filing requirements in certain circumstances (hereinafter,
``expedited or reduced filing procedures''). The OCC first introduced
these expedited or reduced filing procedures in 1996, when the
regulations in 12 CFR part 5 were amended to include expedited
procedures for certain filings by ``eligible banks.'' \1\ The 1996
[[Page 51578]]
amendments also established notice procedures, rather than
applications, for certain filings by national banks that were
``adequately capitalized'' or ``well capitalized,'' as those terms are
defined in the prompt corrective action (PCA) framework set forth in 12
CFR part 6.\2\ Over time, the OCC has amended and expanded these
expedited or reduced filing procedures, with current 12 CFR part 5
providing expedited or reduced filing procedures to OCC-supervised
institutions that are: (1) either an ``eligible bank'' or ``eligible
savings association,'' or (2) both ``well managed'' and ``well
capitalized.'' These procedures reduce the baseline burden for OCC-
supervised institutions that satisfy the eligibility criteria, as there
is either less burden in preparing the requisite filing for the OCC,
reduced delay before engaging in a proposed activity or transaction, or
both. As noted when the OCC first adopted expedited review, certain
applications by healthy institutions entail low levels of risk.\3\ The
OCC similarly believes that applications by community national banks
and community Federal savings associations will generally present low
levels of risk, comparable to those by eligible banks and eligible
savings associations, and thus should also benefit from expedited or
reduced filing procedures.
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\1\ 61 FR 60342-43 (Nov. 27, 1996).
\2\ 61 FR 60343.
\3\ See 61 FR 60342.
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II. Description of the Proposed Rule
The OCC's current licensing requirements generally apply equally
regardless of the size of the OCC-supervised institution. The proposed
rule will modify this approach by establishing a new definition of
``covered community bank or covered community savings association'' and
provide such institutions access to all currently available expedited
or reduced filing procedures. The OCC is proposing these changes as
part of a broader initiative to tailor the regulatory framework for
community national banks and community Federal savings associations,
with the goal of reducing regulatory burden and tailoring requirements
to the size and risk-profile of the institution. Community national
banks and community Federal savings associations typically engage in
lower risk and less complex activities. Accordingly, the OCC will
generally be able to review filings from community national banks and
community Federal savings associations more quickly. Similarly, a lower
risk profile is generally correlated to a proposal more clearly meeting
the evaluative factors and less likely to warrant denial. Accordingly,
the OCC is proposing to expand the existing expedited or reduced filing
procedures to community national banks and community Federal savings
associations that satisfy certain conditions. The OCC will retain the
ability to extend the expedited review period or remove a filing from
expedited review as is currently applied to eligible banks and eligible
savings associations in 12 CFR 5.13(a)(2)(i). Further, the OCC retains
the discretion under 12 CFR 5.2(b) to adopt materially different
procedures for a particular filing, or class of filings, as it deems
necessary, for example, in exceptional circumstances or for unusual
transactions, after providing notice of the change to the filer and to
any other party that the OCC determines should receive notice.
Twelve CFR 5.3 defines the terms that are used throughout part 5.
The OCC is proposing a new definition for this section, covered
community bank or covered community savings association. The proposed
rule would define a ``covered community bank or covered community
savings association'' as a national bank or Federal savings association
that: (1) has less than $30 billion in total assets and is not an
affiliate of a depository institution or foreign bank with $30 billion
or more in total assets, (2) is ``well capitalized'' as defined in 12
CFR 5.3, and (3) is not subject to a cease and desist order, a consent
order, or a formal written agreement, that requires action to improve
the financial condition of the national bank or Federal savings
association unless otherwise informed in writing by the OCC. The total
assets of the national bank, Federal savings association, and any
depository institution affiliate would be as reported in the
institution's Consolidated Report of Condition and Income (Call
Report). Any foreign bank's total assets would be as reported in an
equivalent to a Call Report. A national bank or Federal savings
association would be an affiliate of a depository institution or
foreign bank if it controls, is controlled by, or is under common
control with the depository institution or foreign bank, as ``control''
is defined in 12 CFR 5.50(d)(4). The OCC believes that this standard
for control, as used in the Change in Bank Control Act and implementing
regulations,\4\ provides the appropriate, flexible test for determining
when a national bank or Federal savings association is affiliated with
a larger institution, as this standard is well known and frequently
applied for control analyses.
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\4\ 12 U.S.C. 1817(j); 12 CFR 5.50.
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The proposed definition's $30 billion total asset limitation is
consistent with the OCC's recently announced Community Bank group,
which will supervise institutions with total assets up to that
threshold.\5\ These national banks and Federal savings associations
typically engage in lower risk and less complex activities. The
proposed definition's requirement that the OCC-supervised institution
be ``well capitalized'' is consistent with the OCC's general approach
to conferring expedited or reduced filing procedures. The proposed
definition's enforcement action restriction mirrors the current
language in the ``troubled condition'' definition in 12 CFR
5.51(c)(7)(ii) with respect to enforcement actions. A national bank or
Federal savings association that is not well capitalized or is subject
to an enforcement action that requires improvement in its financial
condition typically has a higher risk profile than a covered community
bank or covered community savings association. Accordingly, the OCC
more closely examines filings from these institutions, and expedited or
reduced filing procedures are not appropriate.
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\5\ See OCC, News Release 2025-89, ``OCC Announces Updates to
Organizational Structure'' (Sept. 18, 2025), <a href="https://www.occ.gov/news-issuances/news-releases/2025/nr-occ-2025-89.html">https://www.occ.gov/news-issuances/news-releases/2025/nr-occ-2025-89.html</a>.
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The OCC's regulations currently have expedited review provisions
for eligible banks or eligible savings associations for thirteen types
of filings. For charter applications, 12 CFR 5.20(j) provides expedited
review for an application to establish a full-service national bank or
Federal savings association sponsored by a bank holding company or
savings and loan holding company whose lead depository institution is
an eligible bank or eligible savings association. Twelve CFR 5.23(d)(4)
and 5.24(h) provide for expedited review of an application to convert
from an eligible bank to a Federal savings association and from an
eligible savings association to a national bank, respectively. Twelve
CFR 5.26(e)(3) provides for expedited review of an application by an
eligible bank or eligible savings association to exercise fiduciary
powers. Twelve CFR 5.30(f)(6) provides for expedited review of
applications for establishment or relocation of a branch by an eligible
bank. Twelve CFR 5.31(f)(2)(iii) provides that an eligible savings
association need not file an application to establish or relocate a
branch if it has published public notice and no person has filed a
comment opposing the
[[Page 51579]]
branch, or if the OCC determines that a comment raises issues not
relevant to the approval standards for an application or a branch or
that OCC action in response to the comment is not required. If an
application is required, because a comment has been filed or the branch
is located in the District of Columbia,\6\ 12 CFR 5.31(f)(1)(iii)
provides for expedited review of applications by an eligible savings
association. Twelve CFR 5.40(c)(4) provides for expedited review of
applications to relocate a main office or home office of an eligible
bank or eligible savings association, respectively. Twelve CFR
5.45(g)(3) provides for expedited review of applications for a capital
increase by an eligible savings association. Twelve CFR 5.46(i)(2)
provides for expedited review of applications for a change in permanent
capital by an eligible bank. Under 12 CFR 5.47(f)(1)(i)(A) and
(f)(2)(i)(A), an eligible bank is required to receive OCC approval to
issue or prepay subordinated debt included in tier 2 capital,
respectively, only if the national bank will not continue to be an
eligible bank after the transaction, the OCC has previously notified
the national bank that prior approval is required, or prior approval is
required by law. Similarly, 12 CFR 5.56(b)(1)(ii) provides for
expedited review of applications to include subordinated debt
securities or mandatorily redeemable preferred stock in tier 2 capital
by an eligible savings association. The OCC proposes adding covered
community bank or covered community savings association to each of
these provisions referencing eligible bank or eligible savings
association.
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\6\ See 12 U.S.C. 1464(m); 12 CFR 5.31(j).
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Under 12 CFR 5.33(i), an application for a business combination is
eligible for expedited review if the filing qualifies as a business
reorganization as defined in 12 CFR 5.33(d)(3) or the filing qualifies
as a streamlined business combination application as described in 12
CFR 5.33(j).\7\ The OCC is proposing to add to paragraph (j) a new
paragraph permitting the use of the streamlined application form when
the acquiring national bank or Federal savings association is a covered
community bank or covered community savings association and the
transaction would result in a national bank or Federal savings
association with less than $30 billion in total assets.
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\7\ Twelve CFR 5.33(j) authorizes the use of a streamlined
application if: (i) at least one party to the transaction is an
eligible bank or eligible savings association, and all other parties
to the transaction are eligible banks, eligible savings
associations, or eligible depository institutions; the resulting
national bank or resulting Federal savings association will be well
capitalized immediately following consummation of the transaction;
and the total assets of the target institution are no more than 50
percent of the total assets of the acquiring bank or Federal savings
association, as reported in each institution's Consolidated Report
of Condition and Income filed for the quarter immediately preceding
the filing of the application; (ii) the acquiring bank or Federal
savings association is an eligible bank or eligible savings
association; the target bank or savings association is not an
eligible bank, eligible savings association, or an eligible
depository institution; the resulting national bank or resulting
Federal savings association will be well capitalized immediately
following consummation of the transaction; and the filers in a
prefiling communication request and obtain approval from the
appropriate OCC licensing office to use the streamlined application;
(iii) the acquiring bank or Federal savings association is an
eligible bank or eligible savings association; the target bank or
savings association is not an eligible bank, eligible savings
association, or an eligible depository institution; the resulting
bank or resulting Federal savings association will be well
capitalized immediately following consummation of the transaction;
and the total assets acquired do not exceed 10 percent of the total
assets of the acquiring national bank or acquiring Federal savings
association, as reported in each institution's Consolidated Report
of Condition and Income filed for the quarter immediately preceding
the filing of the application; or (iv) in the case of a transaction
under 12 CFR 5.33(g)(4), the acquiring bank is an eligible bank; the
resulting national bank will be well capitalized immediately
following consummation of the transaction; the filers in a prefiling
communication request and obtain approval from the appropriate OCC
licensing office to use the streamlined application; and the total
assets acquired do not exceed 10 percent of the total assets of the
acquiring national bank, as reported in the bank's Consolidated
Report of Condition and Income filed for the quarter immediately
preceding the filing of the application.
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Under 12 CFR 5.55(e)(1)(i), a Federal savings association must file
an application before making a capital distribution if, inter alia, it
would not be at least well capitalized or otherwise remain an eligible
savings association following the distribution. The OCC proposes adding
covered community savings association to this provision and
restructuring paragraph (e)(1)(i) for clarity. Specifically, an
application would be required if either the Federal savings association
is not an eligible savings association or a covered community savings
association or the Federal savings association is an eligible savings
association or a covered community savings association but would not
remain well capitalized following the distribution. Twelve CFR
5.55(g)(1) provides for expedited review of capital distribution
applications by eligible savings associations. The OCC proposes adding
covered community savings association to this provision.
The OCC's regulations also provide for expedited or reduced filing
requirements for certain filings by national banks and Federal savings
associations that are well managed and well capitalized. Twelve CFR
5.34(f)(1) generally requires an application for a national bank to
establish or acquire an operating subsidiary or perform a new activity
in an existing operating subsidiary. Twelve CFR 5.34(f)(2) permits a
national bank that is well capitalized and well managed to provide
after the fact notice instead of an application if the operating
subsidiary meets certain structural and activity requirements.
Similarly, 12 CFR 5.34(f)(6) permits a national bank to acquire or
establish an operating subsidiary or perform a new activity in an
existing operating subsidiary if the bank is well managed and well
capitalized and meets other requirements. The OCC is proposing that a
national bank qualify for these expedited or reduced filing
requirements if it is a covered community bank or is both well
capitalized and well managed.
Twelve CFR 5.35(f)(2)(ii) provides for expedited review of a notice
to make an investment in a bank service company or to perform new
activities in an existing bank service company if the national bank or
Federal savings association is well capitalized and well managed and
the bank service company meets certain activity qualifications. The OCC
is proposing adding covered community banks and covered community
savings associations to this provision.
Twelve CFR 5.36(e) permits a national bank to file a notice no
later than 10 days after making a non-controlling investment if the
notice contains, inter alia, a certification that the bank is well
capitalized and well managed at the time of the investment. If the
national bank is not well capitalized and well managed but still meets
other requirements necessary to make the non-controlling investment, it
must instead file an application under 12 CFR 5.36(f). The OCC is
proposing to add covered community bank as an alternative to the
current requirement that a national bank be well capitalized and well
managed for purposes of the certification in 12 CFR 5.36(e)(2). Twelve
CFR 5.36(h)(1) permits a national bank that is well capitalized and
well managed to make a non-controlling investment in an enterprise that
engages in the activities of holding and managing assets acquired by
the parent bank in satisfaction of a debt previously contracted. The
national bank must submit a notice with the OCC no later than 10 days
after making the investment. The OCC is proposing to permit covered
community banks to use this procedure. Twelve CFR 5.58 provides
substantively identical
[[Page 51580]]
provisions for Federal savings association's pass-through investments.
The OCC is proposing parallel changes for covered community savings
associations in that regulation.
Twelve CFR 5.38 provides for expedited review of an application to
establish or acquire an operating subsidiary or to perform a new
activity in an existing operating subsidiary by a Federal savings
association \8\ that is well capitalized and well managed if the
operating subsidiary meets certain structural and activity
requirements. Twelve CFR 5.59 provides for expedited review of an
application to establish or acquire a service corporation, or to
perform a new activity in an existing service corporation subsidiary,
by a Federal savings association \9\ that is well capitalized and well
managed if the service corporation engages only in one or more of the
preapproved activities listed in 12 CFR 5.59(f). The OCC is proposing
to add covered community savings associations to these provisions.
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\8\ Twelve CFR 5.38 does not apply to a Federal savings
association that is not subject to 12 U.S.C. 1828(m) because the
Federal savings association is a Federal savings bank that was
chartered prior to October 15, 1982, as a savings bank under State
law or acquired its principal assets from an institution that was
chartered prior to October 15, 1982, as a savings bank under State
law. See 12 CFR 5.38(b). Such a Federal savings association may
establish or acquire an operating subsidiary or commence a new
activity in an existing operating subsidiary without a filing to the
OCC.
\9\ As with 12 CFR 5.38, the application requirements in 12 CFR
5.59 do not apply to Federal savings associations not subject to 12
U.S.C. 1828(m). See 12 CFR 5.59(h)(1)(i).
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Additionally, the OCC is proposing to clarify the standard for when
an adverse comment raises a significant supervisory, Community
Reinvestment Act (CRA) or compliance concern. Under 12 CFR
5.13(a)(2)(i), the OCC may extend the expedited review period or remove
a filing from expedited review procedures if, inter alia, it concludes
that the filing, or an adverse comment regarding the filing, presents a
significant supervisory, CRA, or compliance concern. The OCC does not
extend the expedited review period or remove a filing from expedited
review procedures if, inter alia, the OCC determines that an adverse
comment does not raise a significant supervisory, CRA, or compliance
concern. The OCC's regulation does not define when a concern is
significant. The OCC is proposing to add a sentence to 12 CFR
5.13(a)(2)(ii) that, for purposes of that paragraph, it considers a
concern to be significant if the facts are previously unknown to the
OCC and, if proven accurate, would support denial of the filing. This
new sentence would provide additional clarity to filers and commenters
on when the OCC may extend the expedited review period or remove a
filing from expedited review procedures in light of the comment. If the
information in a comment is already known to the OCC, the OCC may take
action under 12 CFR 5.13(a)(2)(i) or deny the filing, as appropriate.
If the information in a comment, if accurate, would not support denial
of the filing, the OCC does not see a basis to change the otherwise
applicable expedited processing as the record available to the OCC
would already provide sufficient basis for decision.
III. Request for Comments
The OCC requests comment on all aspects of the expedited or reduced
filing procedures discussed above. The OCC is also considering further
ways to tailor and reduce burden with respect to its licensing
regulations. The OCC requests comment on all aspects of its licensing
regulations, with a purpose of reducing burden, consistent with safety
and soundness, including the following.
1. What asset threshold should the OCC use for covered community
banks and covered community savings associations?
2. Should the OCC aggregate affiliated depository institutions for
purposes of applying the covered community bank or covered community
savings association definition? Should the OCC aggregate the national
bank or Federal savings association with its holding company on a
consolidated basis for purposes of the definition?
3. Are there other provisions in the OCC's licensing regulations
where the OCC should apply expedited or reduced filing procedures for
community national banks and community Federal savings associations?
4. Should the OCC streamline and simplify its regulations for
Federal savings association charters and bylaws in 12 CFR 5.21 and
5.22? If so, how?
5. Should the OCC provide for expedited review for conversion
applications by eligible depository institutions, as defined in 12 CFR
5.3? If so, what timeline should the OCC use to ensure that the OCC has
sufficient time to review the application and perform a pre-conversion
examination, if appropriate?
6. Should the OCC provide for a shorter expedited review period for
national bank branching applications? How should the OCC ensure
compliance with applicable branching requirements under 12 U.S.C. 36?
7. Should the OCC continue to retain branching applications for
Federal savings associations, other than for the establishment of a
branch in the District of Columbia, as required by 12 U.S.C. 1464(m)?
8. Should the OCC eliminate filing requirements for national bank
and Federal savings association operating subsidiaries and non-
controlling and pass-through investments (to the extent permitted by 12
U.S.C. 1828(m) for Federal savings associations)? Are there particular
investments or activities for which the OCC should continue to require
a notice or application?
9. Should the OCC provide for automatic approval of director
residency waiver applications by some or all national banks?
10. Should the OCC reduce the filing requirements for changes in
national bank and Federal savings association capital, to the extent
permitted by applicable statutes?
11. Should the OCC expand the activities permissible for Federal
savings association service corporations?
IV. Regulatory Analysis
Paperwork Reduction Act
Under the Paperwork Reduction Act of 1995 (PRA),\10\ the OCC may
not conduct or sponsor, and a respondent is not required to respond to,
an information collection unless it displays a currently valid Office
of Management and Budget (OMB) control number. The information
collection requirements in this proposed rule have been submitted to
OMB under OMB control number 1557-0014 (Licensing Manual).
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\10\ 44 U.S.C. 3501-3521.
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The proposal would create a new definition of ``covered community
bank or covered community savings association'' and amend various
provisions of 12 CFR part 5 to grant expedited or reduced filing
procedures already present in the regulations to covered community
banks and covered community savings associations.
Title of Information Collection: Licensing Manual.
OMB control number: 1557-0014.
Frequency of Response: Occasional.
Affected Public: National banks and Federal savings associations.
The changes to the burden of the Licensing Manual are de minimis
and continue to be:
Estimated Number of Respondents: 3,694.
Estimated Total Annual Burden: 12,481.15.
Regulatory Flexibility Act
In general, the Regulatory Flexibility Act (RFA) \11\ requires an
agency, in connection with a proposed rule, to prepare an Initial
Regulatory Flexibility
[[Page 51581]]
Analysis describing the impact of the rule on small entities (defined
by the U.S. Small Business Administration for purposes of the RFA to
include commercial banks and savings institutions with total assets of
$850 million or less and trust companies with total assets of $47
million or less). However, under section 605(b) of the RFA, this
analysis is not required if an agency certifies that the proposed rule
would not have a significant economic impact on a substantial number of
small entities and publishes its certification and a short explanatory
statement in the Federal Register along with its proposed rule.
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\11\ 5 U.S.C. 601 et seq.
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The OCC currently supervises approximately 609 small entities.\12\
The OCC estimates that on average, up to 64 OCC-supervised institutions
could be impacted by the rule, based on the definition of covered
community bank or covered community savings association. In general,
the OCC classifies the economic impact on an individual small entity as
significant if the total estimated impact in one year is greater than 5
percent of the small entity's total annual salaries and benefits or
greater than 2.5 percent of the small entity's total non-interest
expense. Furthermore, the OCC considers 5 percent or more of OCC-
supervised small entities to be a substantial number. Thus, at present,
30 OCC-supervised small entities would constitute a substantial number.
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\12\ We base our estimate of the number of small entities on the
Small Business Administration's size thresholds for commercial banks
and savings institutions, and trust companies, which are $850
million and $47 million, respectively. Consistent with the General
Principles of Affiliation 13 CFR 121.103(a), we count the assets of
affiliated financial institutions when determining if we should
classify an OCC-supervised institution as a small entity. We use
December 31, 2024, to determine size because a ``financial
institution's assets are determined by averaging the assets reported
on its four quarterly financial statements for the preceding year.''
See footnote 8 of the U.S. Small Business Administration's Table of
Size Standards.
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The proposed rule would provide expedited review of certain
applications for some small entities and would require fewer filings
for some small entities for other types of filings. This would result
in cost savings for some OCC-regulated institutions that would now
qualify for expedited or reduced filing procedures. Although there are
individual small entities that would be impacted by the proposed rule,
the economic impact would not be more than 5 percent of the small
entity's total annual salaries and benefits nor greater than 2.5
percent of the small entity's total non-interest expense. Accordingly,
the OCC expects the proposed rule to have a de minimis effect on small
entities. The OCC certifies that the proposed rule would not have a
significant economic impact on a substantial number of small entities.
Unfunded Mandates Reform Act
The OCC has analyzed the proposed rule under the factors in the
Unfunded Mandates Reform Act of 1995 (UMRA).\13\ Under this analysis,
the OCC considered whether the proposed rule includes a Federal mandate
that may result in the expenditure by State, local, and tribal
governments, in the aggregate, or by the private sector, of $100
million or more in any one year ($187 million as adjusted annually for
inflation). Pursuant to section 202 of the UMRA,\14\ if a proposed rule
meets this UMRA threshold, the OCC would need to prepare a written
statement that includes, among other things, a cost-benefit analysis of
the proposal. The UMRA does not apply to regulations that incorporate
requirements specifically set forth in law.
---------------------------------------------------------------------------
\13\ 2 U.S.C. 1531 et seq.
\14\ 2 U.S.C. 1532.
---------------------------------------------------------------------------
The OCC's estimates that the proposal would not require additional
expenditure from OCC regulated entities. As noted earlier, there would
likely be a decrease in expenditures due to reduced filing
requirements, resulting in cost savings. Therefore, the OCC finds that
the proposed rule does not trigger the UMRA cost threshold.
Accordingly, the OCC has not prepared the written statement described
in section 202 of the UMRA.
Riegle Community Development and Regulatory Improvement Act of 1994
Pursuant to section 302(a) of the Riegle Community Development and
Regulatory Improvement Act of 1994, 12 U.S.C. 4802(a), in determining
the effective date and administrative compliance requirements for new
regulations that impose additional reporting, disclosure, or other
requirements on insured depository institutions, the agencies will
consider, consistent with principles of safety and soundness and the
public interest: (1) any administrative burdens that the proposed rule
would place on depository institutions, including small depository
institutions and customers of depository institutions; and (2) the
benefits of the proposed rule. The OCC requests comment on any
administrative burdens that the proposed rule would place on depository
institutions, including small depository institutions, and their
customers, and the benefits of the proposed rule that the agencies
should consider in determining the effective date and administrative
compliance requirements for a final rule.
Providing Accountability Through Transparency Act of 2023
The Providing Accountability Through Transparency Act of 2023, 12
U.S.C. 553(b)(4), requires that a notice of proposed rulemaking include
the internet address of a summary of not more than 100 words in length
of a proposed rule, in plain language, that shall be posted on the
internet website <a href="http://www.regulations.gov">www.regulations.gov</a>.
The proposed regulation would amend the OCC's licensing regulations
by providing expedited review or reduced filing requirements for some
licensing applications by community national banks and community
Federal savings association. A community national bank or community
Federal savings association is one that has total assets of less than
$30 billion and meets other criteria related to capital and lack of a
formal enforcement action that requires improvement in financial
condition.
The proposal and the required summary can be found at <a href="https://www.regulations.gov">https://www.regulations.gov</a> by searching for Docket ID OCC-2025-0273 and
<a href="https://occ.gov/topics/laws-and-regulations/occ-regulations/proposed-issuances/index-proposed-issuances.html">https://occ.gov/topics/laws-and-regulations/occ-regulations/proposed-issuances/index-proposed-issuances.html</a>.
Executive Order 12866
Executive Order 12866, titled ``Regulatory Planning and Review,''
as amended, requires the Office of Information and Regulatory Affairs
(OIRA), Office of Management and Budget to determine whether a proposed
rule is a ``significant regulatory action'' prior to the disclosure of
the proposed rule to the public. If OIRA finds the proposed rule to be
a ``significant regulatory action,'' Executive Order 12866 requires the
agencies to conduct a cost-benefit analysis of the proposed rule and
for OIRA to conduct a review of the proposed rule prior to publication
in the Federal Register. Executive Order 12866 defines ``significant
regulatory action'' to mean a regulatory action that is likely to (1)
have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities; (2) create a serious inconsistency or otherwise interfere
with an action taken or planned by another agency; (3) materially alter
the
[[Page 51582]]
budgetary impact of entitlements, grants, user fees, or loan programs
or the rights and obligations of recipients thereof; or (4) raise novel
legal or policy issues arising out of legal mandates, the President's
priorities, or the principles set forth in Executive Order 12866.
The OCC has determined that this proposed rule is not a significant
regulatory action under Executive Order 12866 and, therefore, is not
subject to review under Executive Order 12866.
Executive Order 14192
Executive Order 14192, titled ``Unleashing Prosperity Through
Deregulation,'' requires that an agency, unless prohibited by law,
identify at least 10 existing regulations to be repealed when the
agency publicly proposes for notice and comment or otherwise
promulgates a new regulation with total costs greater than zero.
Executive Order 14192 further requires that new incremental costs
associated with new regulations shall, to the extent permitted by law,
be offset by the elimination of existing costs associated with at least
ten prior regulations. The OCC has determined that the proposed rule is
not a regulatory action for purposes of Executive Order 14192. Further,
the proposed rule, if finalized, would be a deregulatory action under
Executive Order 14192 because it would result in potential cost savings
for OCC-supervised institutions.
List of Subjects in 12 CFR Part 5
Administrative practice and procedure, National banks, Reporting
and recordkeeping requirements, Savings associations, Securities.
For the reasons set forth in the preamble, the OCC proposes to
amend chapter I of title 12 of the Code of Federal Regulations as
follows:
PART 5--RULES, POLICIES, AND PROCEDURES FOR CORPORATE ACTIVITIES
0
1. The authority citation for part 5 continues to read as follows:
Authority: 12 U.S.C. 1 et seq., 24a, 35, 93a, 214a, 215, 215a,
215a-1, 215a-2, 215a-3, 215c, 371d, 481, 1462a, 1463, 1464, 1817(j),
1831i, 1831u, 2901 et seq., 3101 et seq., 3907, and 5412(b)(2)(B).
0
2. Amend Sec. 5.3 by adding the definition of ``Covered community bank
or covered community savings association'' to read as follows:
Sec. 5.3 Definitions.
* * * * *
Covered community bank or covered community savings association
means:
(1) A national bank or Federal savings association that:
(i) Has less than $30 billion in total assets, as reported in the
national bank's or Federal savings association's Call Report, and is
not an affiliate of a depository institution or foreign bank with $30
billion or more in total assets, as reported in the depository
institution's Call Report or the foreign bank's equivalent to a Call
Report;
(ii) Is well capitalized as defined in Sec. 5.3; and
(iii) Is not subject to a cease and desist order, a consent order,
or a formal written agreement, that requires action to improve the
financial condition of the national bank or Federal savings association
unless otherwise informed in writing by the OCC.
(2) For purposes of this definition, the term ``affiliate'' means
any company that controls, is controlled by, or is under common control
with the depository institution or foreign bank, as control is defined
in Sec. 5.50(d)(4).
* * * * *
0
3. Amend Sec. 5.13(a)(2)(ii) by adding a sentence after the first
sentence to read as follows:
Sec. 5.13 Decisions.
(a). * * *
(2) * * *
(ii) * * * For purposes of this paragraph, the OCC considers a
concern to be significant if the facts are previously unknown to the
OCC and, if proven accurate, would support denial of the filing. * * *
* * * * *
Sec. 5.20 [Amended]
0
4. Amend Sec. 5.20(j) by removing the phrase ``eligible bank or
eligible savings association'' and adding in its place the phrase
``eligible bank, eligible savings association, covered community bank,
or covered community savings association''.
Sec. 5.23 [Amended]
0
5. Amend Sec. 5.23(d)(4) by adding the phrase ``or covered community
bank'' after the phrase ``eligible bank''.
Sec. 5.24 [Amended]
0
6. Amend Sec. 5.24(h) by adding the phrase ``or covered community
savings association'' after the phrase ``eligible savings
association''.
Sec. 5.26 [Amended]
0
7. Amend Sec. 5.26(e)(3) by removing the phrase ``eligible bank or
eligible savings association'' and adding in its place the phrase
``eligible bank, eligible savings association, covered community bank,
or covered community savings association''.
Sec. 5.30 [Amended]
0
8. Amend Sec. 5.30(f)(6) by adding the phrase ``or covered community
bank'' after the phrase ``eligible bank''.
Sec. 5.31 [Amended]
0
9. In Sec. 5.31, amend paragraphs (f)(1)(iii) and (f)(2)(iii)
introductory text by adding the phrase ``or covered community savings
association'' after the phrase ``eligible savings association''.
0
10. Amend Sec. 5.33 by:
0
a. In paragraph (j)(1)(iii) removing the phrase ``application; or'' and
adding in its place the phrase ``application;'';
0
b. In paragraph (j)(1)(iv) removing the period after the phrase
``filing of the application'' and adding in its place the phrase ``;
or''; and
0
c. Adding a new paragraph (j)(1)(v) to read as follows:
Sec. 5.33 Business combinations involving a national bank or Federal
savings association.
* * * * *
(j) * * *
(1) * * *
(v) The acquiring national bank or Federal savings association is a
covered community bank or covered community savings association and the
transaction would result in a national bank or Federal savings
association with less than $30 billion in total assets.
* * * * *
Sec. 5.34 [Amended]
0
11. Amend Sec. 5.34 by:
0
a. In paragraph (f)(2)(i) introductory text adding the phrase ``a
covered community bank or is both'' after the phrase ``a national bank
that is''; and
0
b. In paragraph (f)(6) introductory text ``a covered community bank or
is both'' after the phrase ``if the bank is''.
Sec. 5.35 [Amended]
0
12. Amend Sec. 5.35(f)(2)(ii)(A) by adding the phrase ``a covered
community bank or covered community savings association or is both''
after the phrase ``national bank or Federal savings association is''.
Sec. 5.36 [Amended]
0
13. Amend Sec. 5.36 by:
0
a. In paragraph (e)(3) adding the phrase ``a covered community bank or
is both'' after the phrase ``that the bank is''; and
0
b. In paragraph (h)(1) adding the phrase ``a covered community bank or
is both'' after the phrase ``national bank that is''.
Sec. 5.38 [Amended]
0
14. Amend Sec. 5.38(f)(2)(ii)(A) by adding the phrase ``a covered
[[Page 51583]]
community savings association or is both'' after the phrase ``savings
association is''.
Sec. 5.40 [Amended]
0
15. Amend Sec. 5.40(c)(4) by removing the phrase ``eligible bank or
eligible savings association'' and adding in its place the phrase
``eligible bank, eligible savings association, covered community bank,
or covered community savings association''.
Sec. 5.45 [Amended]
0
16. Amend Sec. 5.45(g)(3) by removing the phrase ``eligible savings
association's application'' and adding in its place the phrase
``application by an eligible savings association or covered community
savings association''.
0
17. Amend Sec. 5.46 by revising and republishing paragraph (i)(2) to
read as follows:
Sec. 5.46 Changes in permanent capital of a national bank.
* * * * *
(i) * * *
(2) Expedited review. An application by an eligible bank or covered
community bank is deemed approved by the OCC 15 days after the date the
OCC receives the application described in paragraph (i)(1) of this
section, unless the OCC notifies the bank prior to that date that the
application has been removed from expedited review, or the expedited
review process is extended, under Sec. 5.13(a)(2). An eligible bank or
covered community bank seeking to decrease its capital may request OCC
approval for up to four consecutive quarters. The request need only
specify a total dollar amount for the four-quarter period and need not
specify amounts for each quarter. An eligible bank may decrease its
capital pursuant to such a plan only if the bank maintains its eligible
bank status before and after each decrease in its capital. A covered
community bank may decrease its capital pursuant to such a plan only if
it maintains its covered community bank status before and after each
decrease in its capital.
0
18. Amend Sec. 5.47 by:
0
a. Redesignating paragraph (f)(1)(i)(B) as paragraph (f)(1)(i)(C);
0
b. Adding new paragraph (f)(1)(i)(B);
0
c. Revising redesignated paragraph (f)(1)(i)(C);
0
d. Redesignating paragraph (f)(2)(i)(B) as paragraph (f)(2)(i)(C);
0
e. Adding new paragraph (f)(2)(i)(B); and
0
f. Revising redesignated paragraph (f)(2)(i)(C).
The additions and revisions read as follows.
Sec. 5.47 Subordinated debt issued by a national bank.
* * * * *
(f) * * *
(1) * * *
(i) * * *
(B) Covered community bank. A covered community bank is required to
receive prior approval from the OCC to issue any subordinated debt, in
accordance with paragraph (g)(1)(i) of this section, if:
(1) The national bank will not continue to be well capitalized
after the transaction;
(2) The OCC has previously notified the national bank that prior
approval is required; or
(3) Prior approval is required by law.
(C) National bank not an eligible bank or covered community bank. A
national bank that is not an eligible bank or covered community bank
must receive prior OCC approval to issue any subordinated debt, in
accordance with paragraph (g)(1)(i) of this section.
* * * * *
(2) * * *
(i) * * *
(B) Covered community bank. A covered community bank is required to
receive prior approval from the OCC to prepay any subordinated debt
that is not included in tier 2 capital (including acceleration,
repurchase, redemption prior to maturity, and exercising a call
option), in accordance with paragraph (g)(1)(ii) of this section, only
if:
(1) The national bank will not continue to be well capitalized
after the transaction;
(2) The OCC has previously notified the national bank that prior
approval is required;
(3) Prior approval is required by law; or
(4) The amount of the proposed prepayment is equal to or greater
than one percent of the national bank's total capital, as defined in 12
CFR 3.2.
(C) National bank not an eligible bank or covered community bank. A
national bank that is not an eligible bank or covered community bank
must receive prior OCC approval to prepay any subordinated debt that is
not included in tier 2 capital (including acceleration, repurchase,
redemption prior to maturity, and exercising a call option), in
accordance with paragraph (g)(1)(ii) of this section.
* * * * *
0
19. Amend Sec. 5.55 by:
0
a. Revising paragraph (e)(1)(i); and
0
b. In paragraphs (g)(1) introductory text and (g)(2)(i) adding the
phrase ``or covered community savings association'' after the phrase
``eligible savings association'';
The revision reads as follows:
Sec. 5.55 Capital distributions by Federal savings associations.
* * * * *
(e) * * *
(1) * * *
(i) The Federal savings association is:
(A) Not an eligible savings association or covered community
savings association; or
(B) Is an eligible savings association or covered community savings
association but would not continue to be well capitalized following the
distribution;
* * * * *
Sec. 5.56 [Amended]
0
20. Amend Sec. 5.56(b)(1)(ii) introductory text by adding the phrase
``or covered community savings association'' after the phrase
``eligible savings association''.
Sec. 5.58 [Amended]
0
21. Amend Sec. 5.58 by:
0
a. In paragraph (e)(3) adding the phrase ``a covered community savings
association or is both'' after the phrase ``that the Federal savings
association is''; and
0
b. In paragraph (h)(1) adding the phrase ``a covered community savings
association or is both'' after the phrase ``Federal savings association
that is''.
Sec. 5.59 [Amended]
0
22. Amend Sec. 5.59(h)(2)(ii)(A) by adding the phrase ``a covered
community savings association or is both'' after the phrase ``savings
association is''.
Jonathan V. Gould,
Comptroller of the Currency.
[FR Doc. 2025-20204 Filed 11-17-25; 8:45 am]
BILLING CODE 4810-33-P
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</html>Indexed from Federal Register on November 18, 2025.
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.