Proposed Rule2025-23986
OCC Guidelines Establishing Heightened Standards for Certain Large Insured National Banks, Insured Federal Savings Associations, and Insured Federal Branches; Technical Amendments
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Published
December 30, 2025
Issuing agencies
Treasury DepartmentComptroller of the Currency
Abstract
The Office of the Comptroller of the Currency (OCC) is proposing to amend its guidelines relating to heightened standards for insured national banks, insured Federal savings associations, and insured Federal branches (Guidelines) to increase the average total consolidated assets threshold for applying the Guidelines from $50 billion to $700 billion. In addition, the proposal would clarify certain compliance dates and make other technical amendments.
Full Text
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<title>Federal Register, Volume 90 Issue 246 (Tuesday, December 30, 2025)</title>
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[Federal Register Volume 90, Number 246 (Tuesday, December 30, 2025)]
[Proposed Rules]
[Pages 61084-61093]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2025-23986]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
12 CFR Part 30
[Docket ID OCC-2025-0207]
RIN 1557-AF36
OCC Guidelines Establishing Heightened Standards for Certain
Large Insured National Banks, Insured Federal Savings Associations, and
Insured Federal Branches; Technical Amendments
AGENCY: Office of the Comptroller of the Currency, Treasury.
[[Page 61085]]
ACTION: Notice of proposed rulemaking; revised guidelines.
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SUMMARY: The Office of the Comptroller of the Currency (OCC) is
proposing to amend its guidelines relating to heightened standards for
insured national banks, insured Federal savings associations, and
insured Federal branches (Guidelines) to increase the average total
consolidated assets threshold for applying the Guidelines from $50
billion to $700 billion. In addition, the proposal would clarify
certain compliance dates and make other technical amendments.
DATES: Comments must be submitted on or before March 2, 2026.
ADDRESSES: You may submit comments to the OCC by any of the methods set
forth below. Commenters are encouraged to submit comments through the
Federal eRulemaking Portal. Please use the title ``OCC Guidelines
Establishing Heightened Standards for Certain Large Insured National
Banks, Insured Federal Savings Associations, and Insured Federal
Branches'' 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-2025-0207''
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#bcced9dbc9d0ddc8d5d3d2cfd4d9d0ccd8d9cfd7fcdbcfdd92dbd3ca"><span class="__cf_email__" data-cfemail="f2809795879e93869b9d9c819a979e8296978199b2958193dc959d84">[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-2025-0207'' 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-2025-0207''
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#ddafb8baa8b1bca9b4b2b3aeb5b8b1adb9b8aeb69dbaaebcf3bab2ab"><span class="__cf_email__" data-cfemail="94e6f1f3e1f8f5e0fdfbfae7fcf1f8e4f0f1e7ffd4f3e7f5baf3fbe2">[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: Eden Gray, Assistant Director, Martin
Chavez, Counsel, Elijah Jenkins, 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
The 2008 financial crisis demonstrated the destabilizing effect
that large, interconnected financial companies can have on the national
economy, capital markets, and the overall financial stability of the
banking system. Following the financial crisis, the OCC developed a set
of ``heightened expectations'' to enhance the agency's supervision and
strengthen the governance and risk management practices of large
institutions.\1\ In 2010, the OCC began communicating these heightened
expectations informally to large banks through the OCC's supervisory
function. The OCC formalized these standards in 2014 by adopting the
Guidelines \2\ pursuant to section 39 of the Federal Deposit Insurance
Act.\3\ The Guidelines are codified in appendix D to the OCC's safety
and soundness standards regulations in 12 CFR part 30. The Guidelines
generally establish minimum standards for the design and implementation
of an institution's risk governance framework and set forth minimum
standards for a board of directors (board) in overseeing the risk
governance framework's design and implementation.
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\1\ For a further account of the heightened expectations
program, refer to the notice of proposed rulemaking entitled OCC
Guidelines Establishing Heightened Standards for Certain Large
Insured National Banks, Insured Federal Savings Associations, and
Insured Federal Branches; Integration of Regulations. 79 FR 4282,
4283 (Jan. 27, 2014).
\2\ 79 FR 54518 (Sept. 11, 2014).
\3\ 12 U.S.C. 1831p-1. Section 39 was enacted as part of the
Federal Deposit Insurance Corporation Improvement Act of 1991,
Public Law 102-242, section 132(a), 105 Stat. 2236, 2267-70 (Dec.
19, 1991). Section 39 authorizes the OCC to prescribe safety and
soundness standards in the form of a regulation or guidelines.
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The Guidelines apply to ``covered banks.'' The term ``covered
bank'' means any insured national bank, insured Federal savings
association, or insured Federal branch of a foreign bank with: (i)
average total consolidated assets equal to or greater than $50 billion;
(ii) average total consolidated assets less than $50 billion if that
bank's parent company controls at least one covered bank; and (iii)
average total consolidated assets less than $50 billion if the OCC
determines such bank's operations are highly complex or otherwise
present a heightened risk.\4\
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\4\ See 12 CFR part 30, appendix D, I.E.1., 5.
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The Guidelines provide that a covered bank should establish and
adhere to a formal, written risk governance framework that includes
well-defined risk management roles and responsibilities for front line
units, independent risk management, and internal audit, commonly
referred to as the ``three lines of defense.'' \5\ The Guidelines
indicate that a covered bank should have a comprehensive written
statement that articulates the bank's risk appetite and serves as a
basis for the risk governance framework.\6\ The Guidelines also
address, in part, concentration and front line unit risk limits,\7\
processes governing risk limit breaches,\8\ risk data aggregation and
reporting,\9\ talent
[[Page 61086]]
management processes,\10\ and compensation and performance management
programs.\11\ Finally, the Guidelines set forth standards for a covered
bank's board. These standards provide, in part, that the board should
provide active oversight of management,\12\ exercise sound, independent
judgment,\13\ and include at least two independent directors.\14\
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\5\ Id. at II.A., II.C.
\6\ Id. at II.E.
\7\ Id. at II.F.
\8\ Id. at II.H.
\9\ Id. at II.J.
\10\ Id. at II.L.
\11\ Id. at II.M.
\12\ Id. at III.B.
\13\ Id. at III.C.
\14\ Id. at III.D. As explained in the Guidelines, this
provision does not supersede other regulatory requirements regarding
the composition of the board that apply to Federal savings
associations. Id. at III.D. n.6.
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The OCC recognizes that the Guidelines, as currently formulated,
establish prescriptive standards for banking organizations. For
instance, the Guidelines articulate highly specific roles and
responsibilities for front line units, independent risk management, and
internal audit. These include, for example, provisions that: (i)
specify when independent risk management should convey material risks
and noncompliance with the risk governance framework to the Chief
Executive Officer, the board, or the board's risk committee; \15\ (ii)
address processes for front line units and independent risk management
regarding risk limit breaches, including when and how to inform
internal stakeholders and the OCC of such breaches as well as the
content of those communications; \16\ and (iii) prescribe internal
audit documentation and reporting standards and specify the content for
those reports.\17\ The Guidelines also establish detailed standards for
the Chief Executive Officer with respect to the development and content
of the strategic plan.\18\
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\15\ See id. at II.C.2.(e)-(f), II.G.5.
\16\ See id. at II.H.
\17\ See id. at II.C.3.(a) (providing that internal audit should
``[m]aintain a complete and current inventory of all of the covered
bank's material processes, product lines, services, and functions,
and assess the risks, including emerging risks, associated with each
. . . .''). See also id. at II.C.3.(c) (providing that internal
audit's reports to the audit committee should identify the root
cause of any material issues and address other specified matters).
\18\ See id. at II.D.
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The prescriptiveness of the Guidelines is also apparent in the
standards that they establish for the board. For instance, the
Guidelines impose certain standards on boards related to ``credible
challenge,'' \19\ ongoing training programs,\20\ and annual self-
assessments.\21\ The Guidelines further contemplate an expansive
administrative role for the board. For example, the Guidelines provide,
in part, that the board or a committee thereof should: (i) approve the
risk governance framework and any significant changes to that
framework; \22\ (ii) review and approve the risk appetite statement;
\23\ and (iii) review and approve a talent management program.\24\
There are other laws and regulations that address and incentivize
covered banks and their boards to implement and adhere to appropriate
corporate governance processes and procedures.\25\
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\19\ Id. at III.B. (``In providing active oversight, the board
of directors may rely on risk assessments and reports prepared by
independent risk management and internal audit to support the
board's ability to question, challenge, and when necessary, oppose
recommendations and decisions made by management. . . .'').
\20\ Id. at III.E.
\21\ Id. at III.F.
\22\ Id. at II.A., III.A.
\23\ Id. at II.G.1.
\24\ Id. at II.L.2.
\25\ See, e.g., 12 U.S.C. 24 (setting forth the corporate powers
of national banks); 12 U.S.C. 71-76 (addressing director
requirements); 12 CFR 5.21-5.22 (addressing Federal savings
association charter and bylaws); 12 CFR 7.2000 (addressing national
bank corporate governance); 12 CFR 7.2008 (addressing the oath of
national bank directors); 12 CFR 7.2010 (addressing national bank
directors' responsibilities); 12 CFR part 30, appendix A; 12 CFR
163.33 (addressing board composition requirements for Federal
savings associations). See also Comptroller of the Currency,
Director's Book: Role of Directors for National Banks and Federal
Savings Associations (2020). The OCC also understands that bank
holding company regulations and guidance address or further
incentivize appropriate corporate governance protocols at the
holding company. See 12 CFR 252.33 (establishing risk management and
risk committee corporate governance requirements for bank holding
companies subject to enhanced prudential standards); Board of
Governors of the Federal Reserve System, Supervisory Guidance on
Board of Directors' Effectiveness, SR Letter 21-3 (Feb. 26, 2021).
See also The Clearing House, Annex A: U.S. Bank Regulatory Related
Matters to be Addressed by the Board or Board Committee Pursuant to
Statute, Regulation or Agency Guidance (May 2016).
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Since the Guidelines were adopted in 2014, the OCC has acquired
significant experience regarding the burdens and benefits of the
Guidelines on covered banks. Considering the extreme prescriptiveness
of the Guidelines and their associated burden on covered banks, the OCC
believes that the standards may only be justified for the largest and
most complex institutions as their size, complexity, and risk profile
pose the greatest risk to financial stability and the banking system.
Accordingly, the OCC believes that it is appropriate to increase the
average total consolidated assets threshold for applying the Guidelines
to covered banks from $50 billion to $700 billion and requests comment
on other potential revisions and improvements to the Guidelines in
light of their prescriptive and burdensome approach.\26\ The proposal
would also retain the OCC's reservation of authority to apply the
Guidelines, in whole or in part, to an institution below the $700
billion average total consolidated assets threshold if the OCC
determines such bank's operations are highly complex or otherwise
present a heightened risk as to warrant application of the
Guidelines.\27\ As explained when the Guidelines were initially
adopted, the ``OCC expects to utilize this authority only if a bank's
operations are highly complex relative to its risk-management
capabilities, and notes that `[t]his is a high threshold that only will
be crossed in extraordinary circumstances.' '' \28\
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\26\ The OCC initially considered increasing the average total
consolidated assets threshold to $500 billion. The OCC ultimately
determined to propose increasing this threshold to $700 billion to
align with the OCC, Federal Deposit Insurance Corporation, and Board
of Governors of the Federal Reserve System's recent joint final rule
entitled Regulatory Capital Rule: Modifications to the Enhanced
Supplementary Leverage Ratio Standards for U.S. Global Systemically
Important Bank Holding Companies and Their Subsidiary Depository
Institutions; Total Loss-Absorbing Capacity and Long-Term Debt
Requirements for U.S. Global Systemically Important Bank Holding
Companies. 90 FR 55248 (Dec. 1, 2025). This final rule applies, in
part, to OCC-supervised national banks and Federal savings
associations that are subsidiaries of bank holding companies with at
least $700 billion in total consolidated assets or at least $10
trillion in assets under custody.
\27\ See 12 CFR part 30, appendix D, at I.C.
\28\ 79 FR 54518, 54522 (Sept. 11, 2014) (quoting Thomas J.
Curry, Comptroller of the Currency, Address at the American Bankers
Association Risk Management Forum (Apr. 10, 2014)). In addition, the
OCC reiterates that it does not intend to exercise the reservation
of authority to apply the Guidelines to community banks. Id.
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By generally excluding institutions with average total consolidated
assets less than $700 billion (Excluded Institutions) from the
Guidelines' scope,\29\ the proposal would provide Excluded Institutions
with the ability to design and implement a risk governance framework
that is best suited to their banking organization. For example, the
proposal would permit an Excluded Institution to develop a risk
governance framework that contains employee roles and responsibilities
tailored to their specific firm, lines of business, and idiosyncratic
risks. This would also allow Excluded Institutions' employees to spend
more time on executing the firm's strategy while simultaneously
[[Page 61087]]
fulfilling their important risk management and compliance
responsibilities. The OCC emphasizes that this proposal would not
authorize Excluded Institutions to neglect their risk management or
compliance responsibilities, or to operate their firms in an unsafe or
unsound manner.\30\ Rather, the OCC expects that Excluded Institutions
will maintain robust risk governance frameworks, risk management
systems, and processes that are tailored to their individual size,
complexity, and risk profile.
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\29\ As discussed later in this SUPPLEMENTARY INFORMATION, an
institution with average total consolidated assets less than $700
billion would continue to be subject to the Guidelines if: (i) its
parent company controls at least one covered bank; or (ii) the OCC
determines such bank's operations are highly complex or otherwise
present a heightened risk. This approach is consistent with the
current regulation. See 12 CFR part 30, appendix D, at I.E.5.
\30\ In particular, the OCC notes that this proposal does not
modify or affect the applicability of the safety and soundness
standards set forth in appendix A to 12 CFR part 30.
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The OCC also expects that this proposal would facilitate innovation
and development in risk management practices by providing Excluded
Institutions with the latitude to develop new ways of managing risk
that are more efficient and effective. For instance, the OCC supports
banking organization efforts to use new technologies and techniques in
a safe and sound manner to identify and manage risks. These innovative
technologies and techniques may be used, for example, to identify
suspicious or anomalous transactions, facilitate textual analysis of
consumer complaint data, or enhance cybersecurity by detecting
malicious activity, identifying compromised systems, and supporting
threat mitigation. Excluded Institutions' innovations in risk
management have the potential to improve the effectiveness and
efficiency of their risk management efforts, improve employee
performance, and reduce the cost of regulatory compliance, thereby
providing banking organizations with the ability to further optimize
their cost structure. This would allow Excluded Institutions to invest
their financial resources in other endeavors such as product and
service development, upgrades to information technology systems and
infrastructure, and customer service improvements.
Similarly, the proposal would enhance the effectiveness of Excluded
Institutions' boards by allowing them to refocus on executing their
core responsibilities. A board's core responsibilities include, but are
not limited to, overseeing the execution of the firm's strategy,
understanding and overseeing the firm's material risk exposures, and
exercising effective oversight of senior management. Rather than
expending effort to satisfy the Guidelines' prescriptive standards, the
proposal would provide Excluded Institutions' boards with more time to
fulfill their core responsibilities which, when executed effectively,
promotes their firms' safety and soundness.
Consistent with the OCC's risk-based supervision approach,\31\ this
proposal would also enable the OCC to enhance the efficiency of its
operations in at least two ways. First, it would allow the OCC to
reallocate supervisory resources from Excluded Institutions to larger,
more complex institutions that pose comparatively greater risk to the
banking system. Second, consistent with the OCC's recent joint notice
of proposed rulemaking entitled ``Unsafe or Unsound Practices, Matters
Requiring Attention,'' \32\ this proposal would enable examiners for
Excluded Institutions to shift their supervisory efforts away from
examining operational processes and refocus on material financial risks
that could affect the safety and soundness of the institutions they
supervise.\33\
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\31\ See ``Bank Supervision Process'' booklet of the
Comptroller's Handbook, 30 (Sept. 2019) (``In carrying out its
mission, the OCC employs an ongoing risk-based supervision approach
focused on evaluating risk, identifying material and emerging
concerns, and requiring banks to take timely corrective action
before deficiencies compromise their safety and soundness. . . . The
risk-based supervision approach concentrates on systemic risks and
banks that pose the greatest risk to the federal banking system.'').
\32\ 90 FR 48835 (Oct. 30, 2025).
\33\ See, e.g., A Failure of Supervision: Bank Failures and the
San Francisco Federal Reserve: Hearing Before the Subcomm. on Health
Care and Financial Services of the H. Comm. on Oversight and
Accountability, 118th Cong. (2023) (Statement of Jeremy R. Newell)
(``[M]odern bank supervision has forcefully embraced an approach
that is overwhelmingly focused on examining processes--that is, risk
management processes, governance structures, compliance programs and
policies and procedures--and not the actual underlying financial
condition and risks those processes ostensibly support.'') (emphasis
in original).
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The OCC believes that it is critical that examiners and
institutions prioritize material financial risks over concerns related
to policies, process, documentation, and other nonfinancial risks. This
proposal reflects the OCC's judgment and experience that its
supervisory resources are best focused on practices that are likely to
materially harm an institution's financial condition, such as risks
that are more likely than other risks to lead to material financial
losses, bank failures, and instability in the banking system. This
means that, for Excluded Institutions, the OCC will no longer focus on
assessing a firm's internal policies, processes, or governance
practices relative to prescriptive standards. Rather, the OCC expects
Excluded Institutions to establish and maintain internal policies,
processes, or governance practices that are best suited to their firm
and consistent with safety and soundness.\34\ While the OCC may
continue to provide guidance to Excluded Institutions on best practices
during the normal course of supervision, this proposal makes clear that
the Guidelines and associated supervisory efforts may only be justified
for the largest and most complex institutions that pose the greatest
risk to financial stability and the banking system. Accordingly, the
OCC believes that it is no longer appropriate to apply the prescriptive
standards in the Guidelines to Excluded Institutions and therefore
proposes an increase to the $50 billion average total consolidated
assets threshold as set forth below.
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\34\ While this proposal would provide an Excluded Institution
with the ability to design and implement a risk governance framework
tailored to its operations, the OCC notes that an Excluded
Institution could continue to reference and benefit from the
standards set forth in the Guidelines as appropriate.
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II. Proposed Changes
Threshold. For the reasons described above, the OCC proposes to
increase from $50 billion to $700 billion the average total
consolidated assets threshold at which the Guidelines apply to covered
banks. Specifically, this proposal would amend the Guidelines'
definition of ``covered bank'' such that the term would mean any
insured national bank, insured Federal savings association, or insured
Federal branch of a foreign bank: (i) with average total consolidated
assets equal to or greater than $700 billion; (ii) with average total
consolidated assets less than $700 billion if that bank's parent
company controls at least one covered bank; or (iii) with average total
consolidated assets less than $700 billion if the OCC determines such
bank's operations are highly complex or otherwise present a heightened
risk.\35\ This change would reduce the number of covered banks to which
the Guidelines apply from 38 institutions to eight institutions, based
on the most recent data available.\36\ Conforming changes would also be
made to other provisions in the Guidelines to replace references to the
$50 billion threshold with the proposed $700 billion threshold.\37\
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\35\ With respect to insured Federal branches of foreign banks,
the OCC reiterates that it would apply the Guidelines in a flexible
manner to such institutions. See 79 FR 54518, 54523 (Sept. 11,
2014).
\36\ A subset of these covered banks are not the lead covered
bank within their respective banking organizations. If the OCC
combines a lead covered bank with its non-lead covered bank
affiliate(s), the total number of banking organizations subject to
the Guidelines would decrease from 31 to five.
\37\ See, e.g., 12 CFR part 30, appendix D, I.A.
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[[Page 61088]]
By further distinguishing applicable risk governance standards
based on size, complexity, and risk profile, this proposal
appropriately recognizes the fact that banks with average total
consolidated assets equal to or greater than $50 billion differ in the
degree of risk they present. Under the proposal, the Guidelines'
enhanced risk governance standards would continue to apply to the
largest, most complex banking organizations that present the greatest
risk to financial stability and the banking system. The proposal would
no longer include Excluded Institutions within the Guidelines' scope
and would provide them with the ability to design and implement a risk
governance framework that is consistent with safety and soundness and
tailored to their individual operations. In addition, this proposed
change would reduce regulatory burden and enable the OCC to optimize
the deployment of its supervisory resources. As set forth below, the
OCC requests comment on other potential revisions and improvements to
the Guidelines given their prescriptive and burdensome approach.
Compliance Date. This proposal generally makes five changes to the
Guidelines' compliance date provisions. First, this proposal clarifies
that a covered bank with average total consolidated assets equal to or
greater than $700 billion as of the effective date should continue to
be in compliance with the Guidelines on the effective date. Second,
this proposal clarifies that a covered bank with average total
consolidated assets less than $700 billion that is a covered bank
because its parent company controls at least one other covered bank as
of or subsequent to the effective date should be in compliance with the
Guidelines on the same date as the other covered bank. Third, the
proposal provides that a covered bank that becomes subject to the
Guidelines after the effective date because its average total
consolidated assets subsequently equal or exceed $700 billion should
comply with the Guidelines within eighteen months, consistent with the
current Guidelines. Fourth, the proposal clarifies that a banking
organization with average total consolidated assets equal to or greater
than $50 billion but less than $700 billion as of the effective date is
not a covered bank, provided it does not meet the definition of a
covered bank, and is no longer required to comply with the Guidelines
on the effective date. Finally, the OCC proposes removing outdated
compliance dates that have already passed and/or are no longer
applicable by virtue of this proposal.
The OCC also proposes certain technical amendments to the
Guidelines.
III. Request for Comment
The OCC invites comment on all aspects of the proposed revisions to
the Guidelines and the following specific questions:
Question 1. In what ways could the OCC improve the Guidelines? In
particular, are there amendments the OCC should consider making to the
Guidelines to enhance the safety and soundness of institutions that
would continue to be ``covered banks'' under the proposal?
Question 2. Rather than exempting Excluded Institutions from the
Guidelines, are there aspects of the Guidelines that should continue to
apply to these banking organizations? If so, what standards or
provisions in the Guidelines should continue to apply to these banking
organizations and why?
Question 3. If there are aspects of the Guidelines that should
continue to apply to Excluded Institutions, should the OCC tailor the
standards applicable to these banking organizations based on size? If
so: (i) what minimum standards or provisions in the Guidelines should
apply to smaller Excluded Institutions and why; and (ii) what standards
or provisions in the Guidelines, in addition to those standards or
provisions applicable to smaller Excluded Institutions, should apply to
larger Excluded Institutions and why? For example, should: (i) smaller
Excluded Institutions be subject to standards addressing the strategic
plan; risk appetite statement; talent management processes; and
compensation and performance management programs; and (ii) larger
Excluded Institutions be subject to those standards identified in (i)
plus standards addressing concentration and front line unit risk
limits; risk appetite review, monitoring, and communication processes;
concentration risk management; and the relationship of the risk
appetite statement, concentration risk limits, and front line unit risk
limits to other processes?
Question 4. For those institutions that would continue to be
``covered banks'' under the proposal, are there aspects of the
Guidelines that should be removed or revised to reduce regulatory
burden? If so, what standards or provisions in the Guidelines should be
removed or revised and why?
Question 5. Should the OCC rescind the Guidelines? If so, why, and,
if not, why not? If the Guidelines should be rescinded, should they be
reissued as supervisory guidance? If so, why, and, if not, why not?
Alternatively, should the OCC maintain the Guidelines for ``covered
banks'' and issue principles-based supervisory guidance for Excluded
Institutions? If so, why, and, if not, why not?
Question 6. In what ways could the OCC improve the transparency of
its implementation of the Guidelines? What specific steps would
institutions that would continue to be ``covered banks'' under the
proposal find helpful to make compliance with the Guidelines more
efficient?
Question 7. Are there specific standards or provisions in the
Guidelines that duplicate requirements set forth in the Board of
Governors of the Federal Reserve System's (FRB) Enhanced Prudential
Standards codified at Regulation YY (12 CFR 252.1 et seq.)? If so,
should the OCC remove or adjust those duplicative standards or
provisions and why?
Question 8. If the OCC's proposed amendments to the Guidelines are
finalized as proposed, how would the FRB's Enhanced Prudential
Standards continue to affect ``covered banks,'' if at all?
Question 9. Should the OCC increase the Guidelines' average total
consolidated assets threshold to $700 billion? If so, why, and, if not,
why not?
Question 10. Should the OCC consider establishing the Guidelines'
average total consolidated assets threshold at an amount different than
$700 billion? If so, what amount of average total consolidated assets
would be appropriate and why? For example, should the OCC increase the
Guidelines' average total consolidated assets threshold to $500 billion
instead of $700 billion?
Question 11. Should the Guidelines provide that the average total
consolidated assets threshold will be adjusted to reflect inflation,
growth in gross domestic product, or some other metric? If so, what
metric is appropriate and how frequently should the average total
consolidated assets threshold be adjusted based on that metric? If not,
why not?
Question 12. Should the OCC consider a banking organization's
average total consolidated assets and any additional factors for
purposes of defining the term ``covered bank''? If so, what additional
factors should the OCC consider and why? For example, should the OCC
define the term ``covered bank,'' in part, to mean any bank: (i) with
average total consolidated assets equal to or greater than $700
billion; and (ii) that is either not ``well
[[Page 61089]]
capitalized'' or not ``well managed,'' as those terms are defined in 12
CFR 5.3?
Alternatively, should the OCC provide a conditional exclusion from
the Guidelines for a ``covered bank'' that applies as long as the bank
remains ``well capitalized'' and ``well managed,'' as those terms are
defined in 12 CFR 5.3? If so, why, and, if not, why not?
Question 13. The Guidelines provide, in part, that a ``covered
bank'' may use its parent company's risk governance framework if the
risk profiles of the parent company and the covered bank are
substantially the same. The Guidelines explain that a parent company's
and covered bank's risk profiles are substantially the same if the
covered bank's average total consolidated assets represent 95 percent
or more of the parent company's average total consolidated assets.
Should the OCC increase, decrease, maintain, or remove this 95 percent
threshold? If the OCC should remove this threshold, what criteria
should the OCC consider in determining whether a covered bank may use
its parent company's risk governance framework and why?
Question 14. In what ways could the OCC clarify the roles and
responsibilities established for front line units, independent risk
management, and internal audit? For example, should the OCC provide
covered banks with greater flexibility in designating the roles and
responsibilities that should be performed by each organizational unit?
If so, why, and, if not, why not?
Question 15. Should the OCC remove or adjust any roles and
responsibilities for front line units, independent risk management, or
internal audit? If so, what roles and responsibilities should be
removed or adjusted for these organizational units and why? If not, why
not?
Question 16. Are the Guidelines' definitions of ``front line
unit,'' ``independent risk management,'' and ``internal audit''
appropriate or should they be further refined? If these definitions
should be further refined, what amendments should the OCC make and why?
Question 17. The Guidelines provide that the term ``front line
unit'' does not ordinarily include an organizational unit or function
thereof within a covered bank that provides legal services to the
covered bank. Should the OCC revise this provision to clarify that the
term ``front line unit'' excludes an organizational unit or function
thereof within a covered bank that provides legal services to the
covered bank? If so, why, and, if not, why not?
Question 18. Are there other organizational units that should be
expressly excluded from the ``front line unit'' definition? If so, what
organizational units should be excluded and why? If not, why not?
Question 19. How are front line units, independent risk management,
and internal audit using innovative technologies or techniques to
satisfy their responsibilities under the Guidelines? Should the OCC
revise the Guidelines to take into account these organizational units'
use of innovative technologies or techniques to perform their
responsibilities under the Guidelines? If so, what changes should the
OCC make to the Guidelines and why? If not, why not?
Question 20. Should the OCC revise the standard providing that
independent risk management should review and update the risk
governance framework at least annually, and as often as needed to
address improvements in industry risk management practices? If so, why,
and, if not, why not? Similarly, should the OCC revise the standard
providing that the risk governance framework should be independently
assessed on an annual basis? If so, why, and, if not, why not?
Question 21. The Guidelines provide that a covered bank should have
a comprehensive written risk appetite statement that includes both
qualitative components and quantitative limits. Should the OCC revise
the provisions addressing the risk appetite statement? If so, what
adjustments should be made and why? If not, why not?
Question 22. Should the OCC revise the provisions related to
strategic planning? If so, what adjustments should be made and why? If
not, why not? For example, should the OCC revise the standard providing
that the strategic plan cover a three-year period?
Question 23. Do the compensation and performance management
provisions in paragraph II.M. of the Guidelines duplicate other
statutory or regulatory requirements, such as the compensation
provisions in appendix A to 12 CFR part 30? If so, should the OCC
remove or adjust paragraph II.M. of the Guidelines and why? If not, why
not?
Question 24. In various provisions, the Guidelines generally refer
to applicable policies, procedures, and/or processes. Should the OCC
revise the Guidelines to focus on applicable policies, and remove
references to procedures and processes? If so, why, and, if not, why
not?
Question 25. In what ways could the OCC improve the Guidelines with
respect to the standards established for boards of directors in section
III of the Guidelines? Are there board standards currently contained in
the Guidelines that should be removed or adjusted? If so, what
standards should be removed or adjusted and why? For example, should
the OCC remove or further refine paragraph III.B. of the Guidelines,
addressing ``credible challenge,'' or paragraph III.C. of the
Guidelines, providing that each member of the board should exercise
sound, independent judgment? If so, why, and, if not, why not?
Question 26. Paragraph III.B. of the Guidelines provides, in part,
that the board may rely on risk assessments and reports prepared by
independent risk management and internal audit to support the board's
ability to question, challenge, and when necessary, oppose
recommendations and decisions made by management that could cause the
covered bank's risk profile to exceed its risk appetite or jeopardize
the safety and soundness of the covered bank. Should the OCC revise
this paragraph to clarify that the board may rely on risk assessments
and reports prepared by front line units, in addition to independent
risk management and internal audit? If so, why, and, if not, why not?
Question 27. The Guidelines provide that at least two members of
the board should be independent directors. Should the OCC increase or
decrease the number of independent directors set forth in the
Guidelines, maintain the current standard, or remove this standard?
Alternatively, should the Guidelines provide that a certain percentage
of the board, for example 25 percent, consist of independent directors?
If so, what percentage would be appropriate and why? If not, why not?
Question 28. If the chairperson of a covered bank's board is a non-
independent director, should the Guidelines provide that the
independent directors designate, among themselves, a lead independent
director? If so, why and what roles and responsibilities should the
lead independent director have under the Guidelines? If not, why not?
Question 29. Aside from the Guidelines' standards for boards of
directors set forth in section III of the Guidelines, are there other
responsibilities placed upon the board or board committees in the
Guidelines that should be removed or adjusted? If so, what
responsibilities should be removed or adjusted and why? For example,
rather than providing that the full board should evaluate and approve
the strategic plan, should the OCC revise paragraph II.D. of the
Guidelines to provide that the board or a committee thereof should
perform this
[[Page 61090]]
responsibility? Similarly, should the Guidelines continue to provide
that evaluation and approval of the strategic plan occur on an annual
basis? If so, why, and, if not, why not?
Question 30. Paragraph II.L.2. of the Guidelines provides, in part,
that the board or a committee thereof should review and approve a
talent management program that provides for succession planning
regarding the Chief Executive Officer, Chief Audit Executive, and one
or more Chief Risk Executives, their direct reports, and other
potential successors. Should the OCC revise this paragraph to provide
that the board or a committee thereof should review and approve a
talent management program that provides for succession planning only
for the Chief Executive Officer, Chief Audit Executive, and one or more
Chief Risk Executives? If so, why, and, if not, why not?
Question 31. Paragraph II.J.2. of the Guidelines provides, in part,
that a covered bank's policies, procedures, and processes should
provide for the reporting of material risks, concentrations, and
emerging risks in a timely manner to the board. Should the OCC revise
this paragraph to provide that the reporting of material risks,
concentrations, and emerging risks may be made to the board or the
board's risk committee? If so, why, and, if not, why not?
Question 32. Are there responsibilities placed upon the Chief
Executive Officer (CEO) in the Guidelines that should be removed or
adjusted? If so, what responsibilities should be removed or adjusted
and why?
IV. Administrative Law Matters
Paperwork Reduction Act
Under the Paperwork Reduction Act of 1995 (PRA),\38\ 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. This notice of proposed
rulemaking includes changes to an approved collection of information
pursuant to the provisions of the PRA. The OCC submitted the
information collections contained in this notice of proposed rulemaking
to OMB for review and approval, under section 3507(d) of the PRA and
section 1320.11 of OMB's implementing regulations (5 CFR part 1320).
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\38\ 44 U.S.C. 3501-3521.
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The Guidelines contain recordkeeping requirements previously
approved by OMB, which are found in 12 CFR part 30, appendix D.
Appendix D establishes minimum standards for the design and
implementation of a risk governance framework and minimum standards for
a board in providing oversight of the framework's design and
implementation. Appendix D also addresses, in part, the
responsibilities of front line units, independent risk management, and
internal audit, as well as banks' strategic plan, risk appetite
statement, concentration and front line unit risk limits, risk limit
breaches, risk data aggregation and reporting, talent management
processes, and compensation and performance management programs.
Standards for the board include training and annual self-assessments.
Under the proposal, the threshold for applying the Guidelines to a
bank would be increased from $50 billion to $700 billion in average
total consolidated assets. The proposal would implement this change by
modifying the Guidelines' definition of ``covered bank.'' Under this
revised definition, the term ``covered bank'' would mean any insured
national bank, insured Federal savings association, or insured Federal
branch of a foreign bank: (i) with average total consolidated assets
equal to or greater than $700 billion; (ii) with average total
consolidated assets less than $700 billion if that bank's parent
company controls at least one covered bank; or (iii) with average total
consolidated assets less than $700 billion if the OCC determines such
bank's operations are highly complex or otherwise present a heightened
risk. The proposed revisions would revise the number of respondents
required to comply with the Guidelines' recordkeeping requirements.
The following revised information collection was submitted to OMB
for review.
Title: OCC Guidelines Establishing Heightened Standards for Certain
Large Insured National Banks, Insured Federal Savings Associations, and
Insured Federal Branches; Technical Amendments.
OMB Control No.: 1557-0321.
Affected Public: Businesses or other for-profit organizations.
Estimated Burden:
Frequency of Response: On occasion.
Total Number of Respondents: 8.
Total Burden per Respondent: 3,776 hours.
Total Burden for Collection: 30,208 hours.
Comments are invited on:
(a) Whether the collection of information is necessary for the
proper performance of the functions of the OCC, including whether the
information has practical utility;
(b) The accuracy of the OCC's estimate of the burden of the
collection of information;
(c) Ways to enhance the quality, utility, and clarity of the
information to be collected;
(d) Ways to minimize the burden of the collection on respondents,
including through the use of automated collection techniques or other
forms of information technology; and
(e) Estimates of capital or start-up costs and costs of operation,
maintenance, and purchase of services to provide information.
Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) \39\ requires an agency, in
connection with a proposed rule, to prepare an Initial Regulatory
Flexibility Analysis describing the impact of the rule on small
entities (defined by the U.S. Small Business Administration (SBA) 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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\39\ 5 U.S.C. 601 et seq.
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For these reasons, the OCC certifies that this regulation, if
adopted, will not have a significant economic impact on a substantial
number of small entities. Accordingly, an initial Regulatory
Flexibility Analysis is not required. The OCC currently supervises 609
small entities based on the SBA's definition of small entities for RFA
purposes. As discussed in the SUPPLEMENTARY INFORMATION above, the
Guidelines currently apply to any insured national bank, insured
Federal savings association, or insured Federal branch of a foreign
bank: (i) with average total consolidated assets equal to or greater
than $50 billion; (ii) with average total consolidated assets less than
$50 billion if that bank's parent company controls at least one covered
bank; or (iii) with average total consolidated assets less than $50
billion if the OCC determines such bank's operations are highly complex
or otherwise present a heightened risk. This proposal would increase
the average total consolidated assets threshold to $700 billion and,
[[Page 61091]]
therefore, will not affect any small entities using the SBA's
definition of small entities for RFA purposes.
Unfunded Mandates Reform Act
The OCC has analyzed the proposed rule under the factors in the
Unfunded Mandates Reform Act of 1995 (UMRA).\40\ 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,\41\ 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.
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\40\ 2 U.S.C. 1531 et seq.
\41\ 2 U.S.C. 1532.
---------------------------------------------------------------------------
The OCC estimates that this proposal would not require additional
expenditures from OCC-regulated institutions. As discussed in the
SUPPLEMENTARY INFORMATION above, this proposal would likely result in a
decrease in banking organization expenditures because it would remove
compliance mandates for institutions excluded from the Guidelines'
scope, thereby 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,\42\ 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 OCC must consider, consistent with
the principles of safety and soundness and the public interest: (i) any
administrative burdens that the proposed rule would place on depository
institutions, including small depository institutions, and customers of
depository institutions; and (ii) the benefits of the proposed rule.
This rulemaking would not impose additional reporting, disclosure, or
other requirements on insured depository institutions. Therefore,
section 302(a) of the Riegle Community Development and Regulatory
Improvement Act of 1994 does not apply to this rulemaking.
---------------------------------------------------------------------------
\42\ 12 U.S.C. 4802(a).
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Providing Accountability Through Transparency Act of 2023
The Providing Accountability Through Transparency Act of 2023 \43\
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>.
---------------------------------------------------------------------------
\43\ 5 U.S.C. 553(b)(4).
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The OCC is proposing to amend its Guidelines relating to heightened
standards for insured national banks, insured Federal savings
associations, and insured Federal branches to increase the average
total consolidated assets threshold for applying the Guidelines from
$50 billion to $700 billion. In addition, the proposal would clarify
certain compliance dates and make other technical amendments.
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-2025-0207 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 (as Amended)
Executive Order 12866, entitled ``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
OCC 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 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.
OIRA has determined that this proposed rule is an economically
significant regulatory action under section 3(f)(1) of Executive Order
12866 and, therefore, was subject to review under Executive Order
12866. The OCC's analysis conducted in connection with Executive Order
12866 is available at <a href="http://www.regulations.gov">www.regulations.gov</a> and summarized herein.
This proposed rule would apply to any insured national bank,
insured Federal savings association, or insured Federal branch of a
foreign bank: (i) with average total consolidated assets equal to or
greater than $700 billion; (ii) with average total consolidated assets
less than $700 billion if that bank's parent company controls at least
one covered bank; or (iii) with average total consolidated assets less
than $700 billion if the OCC determines such bank's operations are
highly complex or otherwise present a heightened risk.\44\ The OCC's
analysis under Executive Order 12866 assesses the cost savings that
would result if the total number of banking organizations subject to
the Guidelines were to decrease from 31 to five.\45\
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\44\ As previously noted, the proposed $700 billion threshold is
intended to align with the OCC, Federal Deposit Insurance
Corporation, and FRB's recent joint final rule addressing the
enhanced supplementary leverage ratio. See supra note 26.
\45\ As previously discussed, the proposal would reduce the
number of ``covered banks'' to which the Guidelines apply from 38
institutions to eight institutions, based on the most recent data
available. A subset of covered banks are not the lead covered bank
within their respective banking organizations. If the OCC combines a
lead covered bank with its non-lead covered bank affiliate(s), the
total number of banking organizations subject to the Guidelines
would decrease from 31 to five. The OCC's analysis under Executive
Order 12866 assesses the cost savings that would result based on the
number of banking organizations subject to the Guidelines decreasing
from 31 to five because that approach is more conservative and
reflects the fact that a non-lead covered bank may utilize aspects
of its lead covered bank's risk governance framework.
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The most probable cost savings for Excluded Institutions may result
from staffing reductions that reduce duplicative roles and
responsibilities. For example, Excluded Institutions may consider
streamlining their staffs' roles and responsibilities as they may have
established redundant risk management processes across lines of
defense. While Excluded Institutions' efforts to seek greater
operational efficiencies may result in staff reductions, the OCC notes
that this outcome likely depends on idiosyncratic, institution-specific
characteristics. For example, some Excluded Institutions, such as those
[[Page 61092]]
closer to the proposed $700 billion average total consolidated assets
threshold, may not make any changes to their staffing levels.
Accordingly, the OCC's analysis indicates a lower and upper bound of
potential cost savings associated with staffing reductions of
approximately $0 (assuming Excluded Institutions make no staffing
changes) and $220 million (assuming all Excluded Institutions reduce
staff by 20 percent), respectively.
In addition to potential staff reductions, Excluded Institutions
may also experience time savings benefits associated with personnel
that no longer devote time to complying with the Guidelines. The OCC
estimates annual time savings of approximately 3,776 hours per Excluded
Institution.\46\ This would result in 2025 inflation-adjusted cost
savings of $494,656 per Excluded Institution,\47\ or approximately
$12.8 million across all Excluded Institutions.
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\46\ The estimated annual time savings of 3,776 hours is based
on the OCC's analysis when the Guidelines were adopted in 2014.
\47\ To estimate hourly wages, the OCC reviewed data from May
2024 for wages (by industry and occupation) from the U.S. Bureau of
Labor Statistics (BLS) for depository credit intermediation (NAICS
522100). To estimate compensation costs associated with the
Guidelines, the OCC uses $131 per hour, which is based on the
average of the 90th percentile for the occupations reported annually
by the BLS plus an additional 38 percent to cover inflation (equal
to 3.6% in the first quarter of 2025) and private sector benefits.
According to the BLS's employer costs of employee benefits data, 36
percent represents the average private sector costs of employee
benefits. While vastly below the hourly wage of a chief executive
officer or a director of an institution subject to the proposed
rule, the OCC uses the $131 hourly wage for all hours under the
assumption that subordinate employees will perform much of the
preparatory work.
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There may also be indirect savings and indirect costs associated
with the proposal. With respect to indirect savings, increasing the
average total consolidated assets threshold as proposed may, on the
margin, affect institutions' strategic asset size decisions. However,
any cost savings associated with this potential development may be
minimal and the net impact is uncertain. With respect to indirect
costs, increasing the average total consolidated assets threshold could
lead Excluded Institutions to devote fewer resources to maintaining
adequate risk governance and risk management practices. However, this
risk should be low because the proposal does not modify the OCC's
supervisory oversight or standards \48\ nor does it suggest that
Excluded Institutions would change their risk appetite, asset
allocation, or asset growth decisions. In addition, as previously
discussed in this SUPPLEMENTARY INFORMATION, the OCC emphasizes that
this proposal would not authorize Excluded Institutions to neglect
their risk management or compliance responsibilities, or to operate
their firms in an unsafe or unsound manner. Rather, the OCC expects
that Excluded Institutions will maintain robust risk governance
frameworks, risk management systems, and processes that are tailored to
their individual size, complexity, and risk profile. Therefore, the OCC
does not expect that the proposal would adversely impact the adequacy
and comprehensiveness of Excluded Institutions' risk governance and
risk management practices.
---------------------------------------------------------------------------
\48\ See supra note 25.
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The OCC's analysis indicates a lower and upper bound of aggregate
potential cost savings from expected staff reductions and time savings
of approximately $13 million and $233 million, respectively. The OCC
estimated a range of potential outcomes based on different approaches
and operational and strategic decisions by institutions. For example,
the OCC's analysis indicates aggregate cost savings from both expected
staff reductions and time savings ranging from $54 million to $123
million, using an assumption of a 10 percent staff reduction. The OCC
preliminarily concludes that the most plausible outcome is a 10 percent
staff reduction with the assumption that the three largest banks not
subject to the Guidelines would not change their behavior. In this
scenario, the potential cost savings from both expected staff
reductions and time savings would amount to approximately $67 million.
There are no explicit mandates in the proposal for OCC-supervised
institutions. Excluded Institutions' operational and strategic
decisions will ultimately determine the impact of the proposal over the
long term.
Executive Order 14192
Executive Order 14192, entitled ``Unleashing Prosperity Through
Deregulation,'' requires that an agency, unless prohibited by law,
identify at least ten 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 expects the proposed rule as finalized
will be a deregulatory action under Executive Order 14192 because, as
explained elsewhere, the final rule should have total costs less than
zero.
List of Subjects in 12 CFR Part 30
Banks, Banking, Consumer protection, National banks, Privacy,
Reporting and recordkeeping requirements, Safety and soundness.
Authority and Issuance
For the reasons set forth in the preamble, and under the authority
of 12 U.S.C. 93a, chapter I of title 12 of the Code of Federal
Regulations is proposed to be amended as follows:
PART 30--SAFETY AND SOUNDNESS STANDARDS
0
1. The authority citation for part 30 continues to read as follows:
Authority: 12 U.S.C. 1, 93a, 371, 1462a, 1463, 1464, 1467a,
1818, 1828, 1831p-1, 1881-1884, 3102(b) and 5412(b)(2)(B); 15 U.S.C.
1681s, 1681w, 6801, and 6805(b)(1).
0
2. Amend appendix D by:
0
a. Removing the phrase ``$50 billion'' wherever it appears and adding
in its place the phrase ``$700 billion'';
0
b. Revising section I.B.1.;
0
c. Adding section I.B.2., section I.B.3., and section I.B.4.;
0
d. Removing ``;'' and adding ``.'' after ``Guidelines'' in section
I.C.1.; and
0
e. Removing ``; or'' and adding ``.'' after ``Guidelines'' in section
I.C.2.
The revision and additions read as follows:
Appendix D to Part 30--OCC Guidelines Establishing Heightened Standards
for Certain Large Insured National Banks, Insured Federal Savings
Associations, and Insured Federal Branches
* * * * *
I. Introduction
* * * * *
B. Compliance Date
1. A covered bank with average total consolidated assets, as
calculated according to paragraph I.A. of these Guidelines, equal to
or greater than $700 billion as of [EFFECTIVE DATE] should be in
compliance with these Guidelines on [EFFECTIVE DATE].
2. A covered bank with average total consolidated assets, as
calculated according to paragraph I.A. of these Guidelines, less
than $700 billion that is a covered bank because that bank's parent
company controls at least one other covered bank as of or subsequent
to [EFFECTIVE DATE] should be in compliance with these Guidelines on
the date that such other covered bank should comply.
3. A covered bank that does not come within the scope of these
Guidelines on [EFFECTIVE DATE], but subsequently becomes subject to
the Guidelines because average total consolidated assets, as
calculated according to paragraph I.A. of
[[Page 61093]]
these Guidelines, are equal to or greater than $700 billion after
[EFFECTIVE DATE], should comply with these Guidelines within 18
months from the as-of date of the most recent Call Report used in
the calculation of the average.
4. A bank with average total consolidated assets, as calculated
according to paragraph I.A. of these Guidelines, equal to or greater
than $50 billion but less than $700 billion as of [EFFECTIVE DATE]
is not a covered bank, provided it does not meet the definition of a
covered bank set forth at paragraph I.E. of these Guidelines, and
should no longer comply with these Guidelines on [EFFECTIVE DATE].
* * * * *
Jonathan V. Gould,
Comptroller of the Currency.
[FR Doc. 2025-23986 Filed 12-29-25; 8:45 am]
BILLING CODE 4810-33-P
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