Senate passes resolution to repeal OCC's hold on speedy merger approvals
In the world of banking regulation, a series of events has sparked debate and controversy.
Michelle Bowman, the Federal Reserve Governor and Trump administration's nominee to become the central bank's vice chair for supervision, has advocated for a shift in bank regulation thinking, away from "binary thinking." Meanwhile, Michael Hsu, the acting chief of the Office of the Comptroller of the Currency (OCC), proposed a rule last year with the aim of increasing transparency in the merger evaluation process.
However, the Senate has voted to overturn a September 2024 rule from the OCC that would end expedited merger reviews. If the House votes to overturn the OCC's bank merger policy and Trump signs it, the OCC would be barred from issuing a "substantially" similar rule.
The Capital One-Discover deal, approved by the OCC, came with conditions, including addressing three consent orders and paying roughly $1.5 billion in penalties. The approval of this deal has sparked criticism, with Republican lawmakers introducing resolutions to nullify the OCC rule through the Congressional Review Act, arguing the regulator is reaching beyond its mandate.
Travis Hill, Acting Chair of the Federal Deposit Insurance Corp., has prioritized curtailing the timeline of bank merger approvals, while Jeremy Kress, an associate professor of business law at the University of Michigan, argued against the Capital One-Discover deal.
The OCC rule is a rollback of a 1996 policy that deems bank deals as approved on the 15th day after the end of a comment period unless the regulator removes the filing from expedited processing. The updated OCC rule puts greater focus on the agency's effort to weigh the financial stability risk of approving a deal against the risk of denying it, especially for transactions involving troubled institutions.
In a separate development, the Consumer Financial Protection Bureau (CFPB) has faced its own challenges. The Senate voted to overturn a rule regarding overdraft fees at the CFPB, and the Senate and House have each passed resolutions to overturn, through the CRA, a CFPBP final rule that would cap overdraft fees at $5.
As the regulatory landscape continues to evolve, the OCC's bank merger policy and the Capital One-Discover deal remain points of contention. The precise current status of Congressional Review Act resolutions on this OCC merger rule and detailed arguments are not available, requiring further investigation through Congressional records or targeted regulatory news sources for the latest legislative status and arguments.
- The ongoing controversy in banking regulation, as seen in the Capital One-Discover deal and the OCC's bank merger policy, intertwines with business, politics, general news, and policy-and-legislation, as evidenced by the Senate votes to overturn OCC rules, the proposed rule changes by Michelle Bowman and Michael Hsu, and the criticisms from Republican lawmakers.
- The OCC's merger policy, particularly its rule regarding expedited merger reviews, is not only a subject of debate in the world of banking regulation but also a point of interest for finance and policy-and-legislation, with resolutions being proposed to overturn the rule through the Congressional Review Act.
