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  • Otting Sworn in as Comptroller of the Currency; Pushes for Regulation Review

    Federal Issues

    On November 27, Joseph M. Otting was sworn in as the next Comptroller of the Currency following Senate confirmation on November 16. Otting commented in a statement prepared for his swearing-in that he understands “as a career banker” the value and importance of “effective supervision” as well as “the challenges bankers face as they work to meet customer needs while coping with unnecessary regulatory burden that makes it more difficult and complicated than necessary.” Otting asserted that in order for regulations to be effective, modifications must be made as the nation’s needs change. Otting’s stated priorities include “enhancing the value of national bank and federal savings association charters, reducing unnecessary burden, and promoting economic opportunity while maintaining the safety and soundness of the federal banking system.”

    Federal Issues OCC Bank Regulatory

  • Federal Banking Agencies Amend CRA Regulations to Conform With HMDA Regulation Changes

    Agency Rule-Making & Guidance

    On November 24, the Federal Reserve Board, FDIC, and OCC published a joint final rule in the Federal Register, amending their respective Community Reinvestment Act (CRA) regulations. The amended regulations conform with the CFPB’s amendments to Regulation C, which implements the Home Mortgage Disclosure Act (HMDA). The amendments are designed to reduce the burden associated with CRA performance evaluation reporting requirements. Specifically, the amended regulations (i) modify the definitions of “home mortgage loan” and “consumer loan”; (ii) revise the public file content requirements; and (iii) make technical corrections and remove obsolete references to the Neighborhood Stabilization Program (see previous InfoBytes coverage here).

    As previously reported in InfoBytes, amendments to Regulation C generally take effect January 1, 2018, with the agencies’ specific amendments to the CRA regulations taking effect the same day.

    Agency Rule-Making & Guidance OCC Federal Reserve FDIC HMDA Regulation C CRA Federal Register

  • OCC Updates Public Comment Policy on Licensing Applications

    Agency Rule-Making & Guidance

    On November 17, the OCC released Bulletin 2017-55 announcing a revised version of its “Public Notice and Comments” booklet. This revised booklet replaces a May 2017 booklet of the same name, and is part of the Comptroller’s Licensing Manual. The revised booklet reflects updates related to the OCC’s policy regarding review of public comments on licensing filings. Specifically, the OCC will now only consider public comments if they are received before the close of the comment period (typically 30 days following a filing), unless an extension has been granted “in accordance with 12 CFR 5.10(b)(2).” The revised booklet also describes situations in which an extension may be granted.

    Agency Rule-Making & Guidance OCC Licensing Comptroller's Licensing Manual

  • Agencies Announce Availability of 2016 Small Business and Farm CRA Data

    Federal Issues

    On November 21, the three federal banking agency members of the Federal Financial Institutions Examination Council (FFIEC) with Community Reinvestment Act (CRA) responsibility—the Federal Reserve Board, the FDIC, and the OCC—announced the release of the 2016 small business and small farm CRA data. The analysis contains information from 726 lenders reporting data about originations and purchases of small loans (loans with original amounts of $1 million or less) in 2016, a 3.3 percent decrease from 2015.

    The FFIEC disclosure statement on the data for each reporting lender is available here.

    Federal Issues CRA FFIEC OCC FDIC Federal Reserve

  • OCC Updates Comptroller’s Licensing Manual to Provide Revised Guidance on Branching and Relocation Procedures

    Agency Rule-Making & Guidance

    On November 15, the OCC released Bulletin 2017-54 announcing a revised version of its “Branches and Relocations” booklet (replacing the booklet of the same title issued in October 2009), which includes updates related to procedures and requirements for national banks and federal savings associations submitting branch or relocation applications. The booklet, which is part of the Comptroller’s Licensing Manual, covers:

    • policies and criteria of general applicability, including the application and approval process; and
    • specific policies and requirements unique to national banks and those unique to federal savings associations.

    Reflected in the newly revised booklet are updates to procedures and regulations that have been implemented since 2009, including the integration of the Office of Thrift Supervision into the OCC and the issuance of revised regulation 12 C.F.R. § 5 that went into effect July 1, 2015.

    Agency Rule-Making & Guidance OCC Licensing Comptroller's Licensing Manual

  • OCC Updates Comptroller’s Licensing Manual to Provide Revised Guidance on Business Combination Applications

    Agency Rule-Making & Guidance

    On November 14, the OCC released Bulletin 2017-53 announcing a revised version of its “Business Combinations” booklet (replacing the booklet of the same title issued in December 2006), which includes updates related to regulations addressing applications for national banks and federal savings associations proposing to execute a business combination. The booklet, which is part of the Comptroller’s Licensing Manual, covers:

    • policies and decision criteria that the OCC considers when evaluating applications from banks seeking to execute business combinations, including mergers, consolidations, certain purchase and assumption transactions, and reorganizations;
    • the application process, including the pre-filing, filing, review, decision, and post-consummation phases;
    • guidance on application requirements and circumstances under which a streamlined business combination is granted; and
    • references and links to informational resources for applicants to use during the filing process.

    Reflected in the newly revised booklet are updates to procedures and regulations that have been implemented since 2006, including the integration of the Office of Thrift Supervision into the OCC and the issuance of revised regulation 12 C.F.R. § 5 that went into effect July 1, 2015.

    Agency Rule-Making & Guidance OCC Licensing Comptroller's Licensing Manual

  • OCC Updates Policies and Procedures to Clarify Impact of CRA Ratings on Licensing Applications

    Agency Rule-Making & Guidance

    On November 8, the OCC issued Bulletin 2017-51, updating guidance related to its approach when evaluating certain licensing applications from OCC-supervised banks that have “less than satisfactory” Community Reinvestment Act (CRA) ratings, either overall or in one or more particular geographic region. The revised Policies and Procedures Manual (PPM 6300-2) provides clarity on the OCC’s scrutiny of a bank’s CRA performance when an application is submitted to participate in a covered transaction such as (i) establishing or relocating a branch or main or home office; (ii) participating in a Bank Merger Act filing; (iii) converting from a state to a federal charter; and (iv) converting between federal charters. The revisions also allow applicants to document for the OCC how participating in such a transaction would “help the bank to achieve its CRA objectives” and “meet the credit needs of the community it serves, consistent with its safe and sound operation.”

    Agency Rule-Making & Guidance OCC CRA Licensing

  • Agencies Announce Changes to Threshold Amounts for Truth in Lending Act and Consumer Leasing Act

    Agency Rule-Making & Guidance

    On November 8, the CFPB and the Federal Reserve Board (Board) finalized the annual dollar threshold adjustments that govern the application of Regulation Z (Truth in Lending Act) and Regulation M (Consumer Leasing Act) to credit transactions as required by the Dodd-Frank Act. Each year the thresholds must be readjusted based on the annual percentage increase in the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). The exemption threshold for 2018, based on the annual percentage increase in the CPI-W, is now $55,800 or less, except for private student loans and loans secured by real property, which are subject to TILA regardless of the amount.

    Additionally, on November 8, the OCC, along with the CFPB and the Board, finalized amendments to the official interpretations for the regulations implementing section 129H of TILA, which determines the threshold amount for a small loan’s exemption from the special appraisal requirements that apply to higher-priced mortgage loans. The threshold for 2018, based on the annual percentage increase in the CPI-W, is now $26,000.         

    Agency Rule-Making & Guidance CFPB Federal Reserve OCC TILA CLA

  • Acting Comptroller Argues for Removing Separation Between Banking and Commerce

    Federal Issues

    On November 8, Acting Comptroller of the Currency Keith A. Noreika addressed The Clearing House Annual Conference in New York, New York and called for an end to the separation between banking and commerce. Noreika noted that the topic may be considered “taboo” to banking regulators but nonetheless offered “an alternative to the popular narrative.” In his speech, Noreika acknowledged that the premise of the separation is to avoid the risks associated with entangling federally insured deposits with unreliable commercial enterprises. However, he argued, “the recent financial crisis actually demonstrated that there is nothing inherently safer about separating banking and commerce or traditional banking and investment banking,” and further noted that allowing for commingling could generate efficiencies and improve banking economic performance.

    Federal Issues OCC Banking

  • Acting Comptroller Discusses Efforts to Promote Lending and Investment in Distressed Communities

    Lending

    On November 2, Acting Comptroller of the Currency Keith A. Noreika addressed the National Association of Affordable Home Lenders to emphasize the OCC’s efforts to support depository institution lending and investment in distressed communities. In his speech, Noreika discussed the guidance issued by the OCC in August (previously covered by InfoBytes), which covers owner-occupied residential mortgage originations with loan-to-value (LTV) ratios greater than 100 percent. The guidance is intended to aid in the revitalization of certain areas around the country and provide a framework for the OCC’s monitoring of these programs for safe and sound lending practices. Noreika concluded that since August “the guidance and the programs being established…are beginning to make differences in the communities that need reinvestment the most” and encouraged their continued use by reminding the conference that these programs can also provide banks credit under the Community Reinvestment Act (CRA).

    Lending OCC CRA Mortgage Lenders Mortgage Origination

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