Acting Comptroller of the Currency Michael Hsu announced a dramatic cut in the semiannual assessments charged to national banks to address a pricing imbalance among community institutions.
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The reduction marks the fourth time in four years that the OCC has cut regulatory assessment fees that fund supervisory activity. The OCC cut assessment rates by
"The OCC is proactively working to close the pricing differential between state and federal charter assessments," Hsu said in prepared remarks. "The purpose of this adjustment is to level the playing field with the cost of supervision compared to state community bank charters."
The cut in assessments will give community banks "extra breathing space and capacity to invest and seize opportunities related to digitalization, compliance, cybersecurity, and personnel," Hsu said.
The cuts will not reduce the quality of OCC supervision, he said.
The fees are partly based on a bank's size and charged twice a year, once in March and again in September.
The drop in assessment fees will primarily aid community banks that can expect a $41.3 million reduction in assessments. Midsize banks can expect an $11.1 million reduction in assessments while large bankers will see an $18.8 million drop, Hsu said.
Hsu also said the OCC is working to provide increased support for community banks by streamlining the licensing process for de novo banks and updating its approach to risk-based supervision.
The cut in assessments is part of an effort by regulators to encourage community banks to invest in digital technologies, he said.
"My experiences in the 2008 financial crisis taught me about the disastrous consequences that can result from an unlevel playing field where regulatory arbitrage and races to the bottom are allowed to fester," Hsu said. "Under my tenure as acting comptroller, the OCC is requiring fintechs seeking a bank charter to be subject to the same requirements as all national banks and we are engaging with our peer agencies to limit regulatory arbitrage."
