The FDIC is drafting rulemaking to remove reputational risk from its bank supervision, several media outlets reported today. The move follows the Office of the Comptroller of the Currency’s announcement last week that it would no longer use reputational risk in bank examinations and guidance.
Lawmakers have accused regulators of using reputational risk to pressure banks into denying services to certain customers, particularly cryptocurrency firms, and have introduced legislation to ban the practice. The FDIC has not made any official announcements, but in a letter to Congress first reported by Politico, Acting FDIC Chairman Travis Hill said the agency is “actively working on a rulemaking to ensure supervisors do not criticize activities or actions on the basis of reputational risk, which we expect to be able to issue in the near future.”
Some lawmakers reacted positively to the news. In a statement on X, House Financial Services Committee Chairman French Hill (R-Ark.) said that the FDIC has been “wasting resources” targeting crypto firms instead of focusing on its core mission.
“Now, Acting Chair Travis Hill and the Trump Admin are working to right the ship,” Rep. Hill said. “The committee looks forward to a new vision for digital assets at the FDIC.”
