The Office of the Comptroller of the Currency plans to increase examination fees for the first time in nearly 20 years, as the agency expands its role under the Dodd-Frank Act.
Banks have until June 12 to comment on the proposed 14.5% marginal rate hike, which would go into effect in September and apply only to institutions with more than $40 billion in assets.
On average, banks and thrifts covered by the rule change would see an average assessment increase of 12%, which according to the proposal "reflects new supervisory and regulatory initiatives."
Already, signs of a more robust OCC seem to be everywhere. In addition to assuming supervision of federal thrifts following the demise of the Office of Thrift Supervision, the agency has taken a stronger stance on how it monitors anti-money-laundering activities and has formalized its "heightened expectations" program to more aggressively supervise big banks' risk management programs. This follows high-profile fiascoes including a series of AML violations by large institutions and the "London Whale" trading mess at JPMorgan Chase.
"If examiners are actually going to go in and deconstruct transactions... then that is going to cost a lot more than just determining if the right policies, procedures and review committees are in place," says Arthur Wilmarth, a law professor at George Washington University.
The agency, which hasn't raised examination fees since the mid-1990s and even lowered fees in 2008, says the proposal would boost its assessment revenue by about 7%. The actual fee increase for banks would vary by asset size, from about $4,800, or 0.2%, for a bank with $41 billion in assets, to $76 million, or nearly 14%, for a $2 trillion-asset bank.
The agency says in its proposal that a rate increase for community banks would be an "unwarranted" strain on resources, particularly "in light of the fact that the bulk of the OCC's new responsibilities are directed toward large institutions."