OCC and FDIC Finalize Rules Defining Unsafe Banking Practices

The Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation finalized rules on Thursday establishing formal definitions for unsafe and unsound banking practices. First proposed in October, these guidelines create a standardized framework for government examiners to identify improper actions by lenders.

Regulators stated the new definitions are intended to provide clarity and certainty during bank examinations. The move is part of a broader effort by the Trump administration to overhaul bank supervision. Regulatory leaders argue that examiners should prioritize core financial risks rather than focusing on minor infractions.

While the OCC and FDIC have moved forward with these rules, the Federal Reserve System has not yet issued its own proposal regarding these definitions, despite its role in supervising major financial institutions.