Federal banking agencies have issued a new report on actions being taken to reduce the regulatory burden on financial institutions and streamline supervisory procedures.
Member agencies of the Federal Financial Institutions Examination Council on March 23 issued the joint report to Congress detailing their review of rules affecting financial institutions. The Federal Reserve, Office of the Comptroller of the Currency and Federal Deposit Insurance Corporation, in conjunction with the National Credit Union Administration, conducted the review as required by the Economic Growth and Regulatory Paperwork Reduction Act of 1996, according to a joint agency news release.
The act requires federal banking agencies to conduct a review of their rules at least every 10 years to identify outdated or unnecessary regulations. The NCUA is not required to participate in the review, but the agency’s board choose to participate to enhance its own regulatory review process, the release stated.
The agencies’ review particularly focused on the effect of regulations on smaller institutions, such as community banks and savings associations. The agencies received more than 250 comment letters from financial institutions, trade associations, and consumer and community groups during the review process, as well as numerous comments obtained at public outreach meetings, according to the release.
The report describes several joint actions planned or taken by the regulatory agencies, including:
• Simplifying regulatory capital rules for community banks and savings associations;
• Streamlining reports of condition and income (Call Reports);
• Increasing the appraisal threshold for commercial real estate loans; and
• Expanding the number of institutions eligible for less frequent examination cycles.
The report also details individual actions taken by each agency to update its own rules, eliminate unnecessary requirements and streamline supervisory procedures, the release stated.
To view the full report, click here.
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