OCC Issues S. 2155-Mandated Charter Flexibility Proposal

The OCC today issued a proposed rule that would implement a new section of the Home Owners’ Loan Act permitting certain federal thrifts to elect the rights and duties of national banks. The proposal follows a mandate under regulatory reform law S. 2155 that emerged from banker recommendations and has been strongly championed by the American Bankers Association.

Under the proposal, federal savings associations with total consolidated assets of $20 billion or less would be eligible to take an election to become “covered associations.” Doing so would remove portfolio asset restrictions that have limited some banks’ ability to respond to changing community needs. It would also subject those institutions to the same duties, restrictions, penalties, liabilities, conditions, and limitations that apply to national banks without requiring a charter conversion.

Comments on the proposal are due 60 days after publication in the Federal Register. ABA has long called for increased charter flexibility and will provide comments to the OCC.