As it seeks to implement the Genius Act, the Office of the Comptroller of the Currency should consider additional factors when reviewing applications from non-bank entities requesting to become payment stablecoin issuers, and it should seek public comment on those applications, the American Bankers Association and three other bank industry associations said today in a joint letter.
In July, the OCC released a proposed rule outlining the factors it will consider in its application process for stablecoin issuers. ABA associations offered three recommendations for what the application process should include. First, they said the OCC should consider additional factors for applicants that are not subsidiaries of an insured depository institution, or IDI.
“For example, the OCC should require a non-IDI applicant to demonstrate the adequacy of its governance, risk management procedures, operational resilience, cybersecurity practices and recovery planning,” they said. “Consideration of these additional factors is critical because non-IDI applicants seeking to become [issuers] may not be subject to the same robust federal prudential framework to which every IDI is subject, including the federal prudential framework applicable to the parent and affiliates of an IDI.”
Second, the OCC should publish and solicit public comment on applications to become issuers, as many applicants and notices that banks submit to regulators are already subject to public review and comment, the associations said.
Finally, the associations reiterated an earlier request that foreign issuers be subject to home-country capital requirements that are consistent with the requirements imposed on domestic issuers. Foreign issuers present heightened risks because the OCC may have less visibility and less control over those entities, they said.
