Federal Deposit Insurance Corporation (FDIC) Acting Chairman Martin Gruenberg laid out the agency’s priorities for 2022.
“While there are many pressing issues the FDIC will have to address this year, key priorities are the Community Reinvestment Act; climate change; the Bank Merger Act; crypto-assets; and the Basel III capital rule. All of these priorities will require close collaboration among the federal banking agencies,” Gruenberg said.
Gruenberg has been acting chairman of the FDIC since Feb. 5. He previously served as FDIC chairman for five years under President Barack Obama and has served on the FDIC board since 2005. He replaces Jelena McWilliams, who resigned as chair on Feb. 4.
One of the priorities for this year is to strengthen the Community Reinvestment Act (CRA). The CRA requires banks to meet the credit needs of all the communities they serve, including low- and moderate-income communities. Gruenberg said the federal financial regulatory agencies plan to collaborate on a notice of proposed rulemaking to strengthen and enhance CRA in the near future.
Grunberg said the FDIC will also be reviewing the bank merger process. He said the process for considering bank mergers by the agencies has not been comprehensively reviewed in 25 years.
In addition, the FDIC will evaluate crypto-asset risks. Gruenberg called it imperative that the federal banking agencies consider the risks posed by these products and determine the extent to which banking organizations can safely engage in crypto-asset-related activities. Further, the agencies will need to provide guidance to the banking industry on the management of prudential and consumer protection risks raised by crypto-asset activities.
Another priority is to address risks posed by climate change to banks and the financial system. The FDIC will offer guidance designed to help banks prudently manage these risks; establish an FDIC interdivisional, interdisciplinary working group on climate-related financial risks; and join the international Network of Central Banks and Supervisors for Greening the Financial System.
Finally, the FDIC plans to finalize the Basel III capital rule to strengthen the regulatory framework for large banking organizations. This includes strengthening the capital requirements related to market risk, operational risk, and the risks associated with financial derivatives.
“I also want to acknowledge the extraordinary dedication of the FDIC staff who will be critical to carrying forward the work on these priorities,” Gruenberg said. “In addition, I want to recognize Chairman Jelena McWilliams for her contributions to the FDIC, in particular for her commitment, which I share, to diversity and inclusion and minority depository institutions.”