OCC Shifts Bank Oversight to Focus on Material Financial Risks

The agency’s updated framework, released August 27, introduces a sharper focus on the size and complexity of institutions, acknowledging that a practice triggering enforcement at a major bank might not warrant the same response at a community firm. Comptroller Jonathan Gould described the shift as a return to risk-based supervision, emphasizing that enforcement actions should remain proportionate to the threat posed to financial stability or customer interests.

Central to this change is the public disclosure of the "Matters Requiring Attention" (MRA) manual, which limits the issuance of formal directives to conduct that meets specific risk thresholds. Under a concurrent proposal, legal violations will be categorized as either substantive or technical. While substantive breaches—defined by criteria such as customer harm, insider misconduct, or systemic inaccuracy—will remain subject to formal remediation, technical violations will no longer automatically trigger regulator-prescribed correction methods. This policy applies across the board, including to federally supervised trust banks managing digital-asset custody and stablecoin reserves, ensuring that crypto-focused entities face the same standardized scrutiny as traditional lenders.