The Office of the Comptroller of the Currency (OCC) announced it had taken action to reduce regulatory burdens on community banks.
The actions build on previous guidance to community banks and the agency’s proposed rulemakings that tailor risk-based supervision to focus material financial risk and prioritize reforms. The agency said its actions will support community banks and strengthen their position as drivers of economic growth.
“Community banks provide the majority of small business lending and are essential to a diverse, competitive and resilient financial system,” Comptroller of the Currency Jonathan V. Gould said. “Today’s actions further relieve community banks of unnecessary regulatory requirements and seek to better position them to help fuel job creation and economic development in local communities across the country.”
The OCC issued supplementary guidance that tailors the agency’s application of the Bank Secrecy Act/Anti-Money Laundering (BSA/AML) examination procedures based on the bank’s generally low levels of money laundering and terrorist financing risk. The OCC said this approach allows the OCC to consider a community bank’s risk profile rather than rely on minimum examination procedures that are unduly burdensome for banks and examiners. The agency also said it was discontinuing its efforts to improve the effectiveness and efficiency of BSA/AML compliance while reducing burden on community banks.
The OCC also issued a Request for Information to better understand the challenges community banks face with core service providers and other third-party service provider.
OCC said it will continue to work to prioritize community bank reforms and that a proposal to reduce the community bank leverage ratio would be announced soon.