In June, the Consumer Financial Protection Bureau’s (CFPB) Office of Competition and Innovation and Office of Markets issued an analysis of deposit insurance coverage on funds stored through popular payment companies, finding that such funds are often not stored in an account at a bank or credit union and thus lack individual insurance coverage. As a result, such funds can be at risk of loss in the event of financial distress or failure of the entity operating the nonbank payment platform.
On June 29, the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency, and the National Credit Union Administration (collectively, the agencies) issued a joint policy statement on commercial real estate loan workouts building on existing guidance calling for financial institutions to work “prudently and constructively” with distressed borrowers. The joint policy statement supersedes the agencies’ 2009 guidance.
On June 21, the Consumer Financial Protection Bureau (CFPB) released two reports detailing access to banking and the financial experience of consumers living in the Southern states. Many areas of the South are considered “banking deserts” because of the lack of banking options. In the press release announcing the release of the reports, CFPB Director Rohit Chopra stated, “[t]he rural South faces distinct challenges when it comes to fair access to banking. Understanding regional differences across the country will help us determine where financial marketplaces can work better for all.”
At a Peterson Institute for International Economics event on June 22, Federal Deposit Insurance Corporation (FDIC) Chairman Martin Gruenberg announced that the FDIC — along with the Board of Governors of the Federal Reserve System (Federal Reserve) and the Office of the Comptroller of the Currency (OCC) — will issue an interagency notice of proposed
On June 16, The Board of Governors of the Federal Reserve System (Federal Reserve) launched its Master Account and Services Database, providing a searchable database on which financial institutions have access to the Federal Reserve master accounts and financial services. A master account is an account in which a Federal Reserve bank receives deposits
On June 22, the Office of the Comptroller of the Currency (OCC) released Version 1.0 of its Asset Management booklet, which provides an overview of sound risk management processes for bank asset management. The OCC will apply this updated booklet to the supervision of community banks engaged in asset management activities.
Version 1.0 is a
On June 14, the Office of the Comptroller of the Currency (OCC) published the spring edition of its Semiannual Risk Perspective, which discusses key issues facing banks. The good news is that the federal banking system saw historic growth in net interest income in 2022. However, rising interest rates weigh on other aspects of bank performance, such as noninterest income, as mortgage activity continues to slow.
On June 9, the Office of the Comptroller of the Currency (OCC) announced it is requesting information for a proposed annual survey aimed at understanding and measuring the public’s trust in banking and banking supervision. The OCC is inviting various stakeholders to comment on the survey’s scope and ways to track public trust over time.
On June 6, the Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, and Office of the Comptroller of the Currency (collectively, the agencies) issued guidance to banking organizations on managing the risks associated with third party relationships. This final guidance reflects the 82 comment letters the agencies received from banking organizations, financial technology (fintech) companies and other third party providers on the proposed guidance released in July 2021 and replaces each agency’s existing guidance to ensure consistency in supervisory enforcement. While the agencies acknowledge that “[t]he use of third parties can offer banking organizations significant benefits, such as quicker and more efficient access to technologies, human capital, delivery channels, products, services, and markets,” they caution that the use of third parties “does not remove the need for sound risk management.” The agencies emphasize, however, that supervisory guidance does not have the force and effect of law and does not impose any new requirements on banking organizations.
On June 1, The Board of Governors of the Federal Reserve System (Board of Governors) and the California Department of Financial Protection and Innovation (CA DFPI) announced a mutual consent order with Silvergate Capital Corporation, a former leader in crypto lending, providing for the winding down of its operations.
Under the terms of the consent