Comptroller Seeks to Reset Risk Tolerance for Federal Banks
"[T]he OCC is reviewing the entire post-2008 chartering, regulatory, and supervisory framework [and] [w]e will be making adjustments where Congress has given us the discretion to do so."
Jonathan V. Gould, Comptroller of the Currency
"[T]he OCC is reviewing the entire post-2008 chartering, regulatory, and supervisory framework [and] [w]e will be making adjustments where Congress has given us the discretion to do so."
Jonathan V. Gould, Comptroller of the Currency
At a Financial Stability Oversight Council meeting, Comptroller of the Currency Jonathan V. Gould outlined a new regulatory and supervisory agenda focused on recalibrating risk tolerance.
Mr. Gould said the OCC would "reset[] the risk tolerance" for the federal banking system, by reconsidering the post-2008 regulatory framework, which focused on micromanagement and risk elimination. He said that this approach has led to a "stagnant and increasingly irrelevant banking system" by pushing activities outside the regulated banking sector. Mr. Gould contended that true financial stability depends on economic growth and a shift from risk elimination to a more calibrated approach to risk management.
Mr. Gould said the OCC’s priorities are:
- Reinvigorating chartering and licensing. Mr. Gould said OCC is reprioritizing the chartering and licensing function to ensure policy is set at the highest levels of the agency. He noted that licensing reviews will also be used to address concerns about debanking consistent with the President’s Executive Order concerning financial institutions engaging in unacceptable practices that restrict access to financial services on the basis of political or religious beliefs.
- Simplifying regulation. Mr. Gould said the OCC will work with other banking agencies to simplify capital and liquidity frameworks, which he described as overly complex. He noted plans to tailor rules for community banks by revising leverage ratio standards and raising regulatory thresholds where possible. He also committed to eliminating reliance on vague supervisory concepts such as "reputation risk" and to implement statutory reforms, including the GENIUS Act.
- Reforming supervision. Mr. Gould said supervisory approaches would be aligned with the agency’s tailored regulatory framework, beginning with reforms for community banks. He described efforts to scale back exam activities unrelated to material financial risks, reduce redundant oversight across agencies, and strengthen focus on areas that directly affect a bank’s financial condition. He cited the failures in supervision during the Silicon Valley Bank collapse as a reminder of the need to concentrate on core risks.