Comptroller Curry Discusses Efforts to Reduce Regulatory Burden (with Lofchie Comment)
Comptroller of the Currency Thomas Curry delivered a speech at an Interagency Outreach Meeting in which he discussed possible ways to reduce regulatory burdens for smaller institutions.
According to Comptroller Curry, while most regulations should provide benefits that outweigh the burdens they impose, the way regulatory rulebooks add more requirements over time can be "onerous forsmall banks."
To remove unnecessary regulatory burdens for smaller institutions, Comptroller Curry proposed:
- to raise the asset threshold from $500 million to $750 million in order to qualify 300 additional banks and thrifts for the 18-month examination cycle, thereby reducing the burden on those institutions as well as allowing the federal banking agencies to focus supervisory resources on banks and thrifts that may present capital, managerial or other issues of supervisory concern;
- to exempt community banks, or banks and thrifts with less than $10 billion in assets, from the Volcker Rule; and
- to authorize a basic set of powers for federal savings associations and national banks so that savings associations can change business strategy without moving to a different charter.
Comptroller Curry stated that the OCC is hopeful that Congress will act on these proposals in the next legislative session.
Lofchie Comment: Comptroller Curry's common sense perspective, that regulations should provide benefits that outweigh the burdens they impose and his concern about the way regulatory rulebooks add more onerous requirements over time, provides an appropriate starting point for reassessing recent regulatory overreach and over-burden. It is not just that regulatory overreach is a drag on small banks; it is a drag on medium-sized banks, big banks and the economy as a whole. In fact, the remarkable thing is that large sections of Dodd-Frank have still not been memorialized in rules, and many of the rules that have been adopted have been delayed in effectiveness. So, even as regulators begin to confront the costs of onerous rules, there are many more rulemakings in the pipeline. Without a full-fledged, intellectually aggressive reassessment of what rules make sense, small banks (and medium and big banks) will be subject to a lot more rules in a year - and in two years - than they are today. It's not enough to slow the tide; regulators need to push back the ocean.