OCC Proposes Changes to OREO Regulations

The OCC is issuing a proposal to update its regulations on other real estate owned, or OREO—the first such update to the rules in two decades. The proposal would seek to streamline and clarify OREO rules for national banks, while updating and harmonizing the framework for OREO activities at federal savings associations.

Specifically, the proposal addresses the holding period for OREO, the methods by which institutions may dispose of OREO, applicable appraisal requirements and permissible OREO expenditures and notification requirements. In addition, the agency is proposing to remove outdated capital rules for national banks and federal savings associations, which include provisions related to OREO. Comments are due by June 23.