The US Office of the Comptroller of the Currency (OCC) has published final guidelines to strengthen the governance and risk management practices of large financial institutions.
The guidelines apply to insured national banks, insured federal savings associations, and insured federal branches of foreign banks with $50bn or more in average total consolidated assets.
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The guidelines also apply to an OCC-regulated institution with less than $50bn in average total consolidated assets if that institution’s parent company controls at least one other covered institution.
The final rules established the minimum standards for the design and implementation of the bank’s risk framework and the minimum standards for the board of directors in overseeing the design and implementation.
Under the new policy, the OCC has set up a faster path to enforcement action. The agency can tell a bank to resolve a violation, and if the lender doesn’t produce or adhere to a plan, it can skip a judicial hearing and issue an order that could include monetary penalties.
The OCC first proposed its tougher standards in January to formalize its new "heightened expectations" for the banks it oversees.
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By GlobalDataThe OCC said for banks with $750bn or more in average total consolidated assets, the guidelines are effective immediately.
However, institutions between $100bn and $750bn in consolidated assets should comply within six months of publication.
