As the OCC’s long-awaited HOLA flexibility rule took effect this week, the agency issued several documents to help bankers understand the new rule and provide guidance to institutions wishing to elect to become “covered associations.”
Under the final rule, federal savings associations with total consolidated assets of $20 billion or less as of Dec. 31, 2017, may at any time elect to become covered associations. Making this election will remove portfolio asset restrictions that have limited some banks’ ability to respond to changing needs in their communities. It will also subject those institutions to the same duties, restrictions, penalties, liabilities, conditions and limitations that apply to national banks without requiring a charter conversion.
The OCC issued a set of FAQs about the final rule, as well as a document outlining key differences among requirements for national banks, federal savings associations and covered savings associations. The agency also published a chart summarizing the powers of national banks and federal savings associations.
