The FDIC, OCC, Consumer Financial Protection Bureau and the National Credit Union Administration today each issued final rules codifying that regulatory guidance does not have the force and effect of law, granting much of a joint petition filed by the American Bankers Association and the Bank Policy Institute that sought a formal rulemaking to ensure that banking organizations would not need to rely on a 2018 interagency statement to clarify the role of guidance.
The agencies confirmed in the final rule that they do not “take enforcement actions or issue supervisory criticisms based on non-compliance with supervisory guidance. Rather, supervisory guidance outlines supervisory expectations and priorities, or articulates views regarding appropriate practices for a given subject area.” Meanwhile, regulations do have the force and effect of law and enforcement actions can be taken if regulated institutions are in violation. Regulations are also generally required to go through the notice and comment process.
The agencies are adopting the final rule on an agency-by-agency basis, rather than pursue a joint final rulemaking, noting that “having separate final rules has enabled agencies to better focus on explaining any agency-specific issues to their respective audiences of supervised institutions and agency employees.” The Federal Reserve is expected to adopt similar rules in the near future.