Speaking today at the American Bankers Association Annual Convention in Charlotte, North Carolina, Comptroller of the Currency Jonathan Gould said his focus as a banking regulator is to correct the regulatory overreach that has taken place since the 2008 financial crisis, particularly for the community bank sector.
“One of the things that really shaped me was the reaction among certain policymakers and the kind of broad-brush vilification of the industry that occurred post-2008, which was, I think, wildly inappropriate,” Gould said. “And this led to a lot of bad supervision and regulatory policy over the following 17 years. So one of the most important things that I can do is reset that risk tolerance and take a much more thoughtful approach, rather than a merely reactionary approach, to regulation and supervision.”
As for community banking, Gould noted that in recent weeks the OCC has reduced assessments by 30% for banks with assets less than $40 billion and brought back a dedicated supervisory group for the sector. The agency also will refocus supervision on material financial risks; will no longer examine community banks for compliance with agency policy, only statutory obligations; has established an expedited licensing process for proposed community bank mergers and applications; and is planning to ease Community Reinvestment Act reviews for community banks.
“Just on its face, that just doesn’t make any sense,” Gould said about CRA reviews. “If you weren’t meeting the credit needs of your local communities, community banks would cease to exist. I don’t know why we’re spending so many resources on that.”
