OCC proposes giving some thrifts same rights as national banks

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WASHINGTON — The Office of the Comptroller of the Currency issued a proposal Monday to allow federal savings associations with assets below $20 billion to operate more like national banks.

The plan would give thrifts the option to enjoy the same rights and privileges available to national banks, while also being subject to the same restrictions, penalties and limitations.

The proposed rule is another step in the OCC’s implementation of a regulatory relief bill that President Trump signed into law in May. That bill amended the Home Owner’s Loan Act to permit certain federal thrifts to elect to operate as national banks, subject to the OCC’s supervision.

“The OCC has long advocated for greater flexibility for federal savings associations to adapt to the needs of their customers and the marketplace without the burdens and costs of changing federal charters,” Comptroller of the Currency Joseph Otting said in a press release. “I am pleased that the measure was included among the bipartisan, common sense reforms enacted this spring. The agency will work expeditiously to implement this important change.”

Under the proposed rule, covered thrifts would be required to divest, conform or discontinue nonconforming subsidiaries, assets and activities, so that they do not operate in a manner that would not be permissible for national banks.

The rule would treat covered federal thrifts and national banks differently when necessary to allow covered thrifts to retain their federal savings association charters and associated governance processes.

To reduce unnecessary burdens, the proposed rule also would allow covered thrifts to continue to use federal savings association procedures rather than national bank procedures where the application of those procedures would not result in substantively different outcomes.

Comments on the proposed rule will be accepted 60 days after it is published with the Federal Register.

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