WASHINGTON - The Office of Thrift Supervision kicked off a yearlong regulatory relief campaign this week with a proposal to restructure its rulebook and drop some out-of-date rules.
"In this first phase, we're targeting structural changes and sort of the easy-kill objects," said G. Jeffrey Miner, the agency's deputy general counsel and one of the authors of the plan, which was published as a proposed rule in Monday's Federal Register.
Next will come the more sensitive work of streamlining the agency's documentation-heavy lending rules - a proposed regulation on this is expected out before the end of the year.
That effort will be followed by a reworking of the agency's regulations on preemption of state laws, adjustable-rate mortgages, thrift subsidiaries, insurance sales, and thrift charters and bylaws.
Mr. Miner said the regulatory relief proposals will not address capital standards or other safety-and-soundness rules - tender topics for an agency whose predecessor, the Federal Home Loan Bank Board, was blamed for worsening the 1980s thrift crisis with lax capital rules.
"Nobody's talking about undoing FIRREA reforms," he said, referring to the 1989 Financial Institutions Reform, Recovery, and Enforcement Act, which created the Office of Thrift Supervision. "On the other hand, we've inherited from the board tons of regulations that may not go to safety and soundness."
The changes will be substantial, Mr. Miner said. "There's nothing cosmetic about this."
There may be something futile about it, however, if Congress heeds bankers' pleas and does away with the thrift charter and the thrift regulator.
"We can't stop trying to improve the regulation of thrifts to wait and see whether there's going to be charter-merger legislation," Mr. Miner said.
The proposed regulation attempts to reorganize the OTS rulebook in a way that agency staff members think makes more sense.
All regulations having to do with safety and soundness are being consolidated into one part of the rules. Another section will contain definitions of all terms that are used in more than one part of the rulebook.
"We're not going to make the industry learn a new set of regulatory definitions," Mr. Miner said. "The question is, are our regulatory definitions located where you can find them?"
Other changes envisioned in the proposed regulation include dropping sections that simply restate laws and repealing the requirement that every thrift publish an annual statement of condition in a newspaper and make such statements available at every branch.
The OTS also is considering deleting policy statements on insurance, late charges, mortgage prepayment penalties, and other issues.
At several points in the proposal, the agency asks if thrift executives and other readers would be helped by such a major rewrite, or would prefer to leave the rulebook essentially as it is. Comments on this and other aspects of the proposed regulation will be accepted through Oct. 27.
The people at OTS, to be sure, favor big changes.
"That's certainly the direction we're leaning in," said John Price, the agency's assistant director for supervision policy. "That's our bias at this point."