State Bank Commissioner office calls Kansas banking system "stable," flags oversight gaps for technology-enabled fiduciary firms and urges IT examiners remain独

The Office of the State Bank Commissioner told the Kansas Senate Committee on Financial Institutions and Insurance on Jan. 14 that the states banking industry is healthy and stable, while warning that statutory limits on oversight of Technology Enabled Fiduciary Financial Institutions (TEPIs) prevent the office from providing assurance about those entities' safety and soundness.

Jesse Becker, director of administration and finance and chief financial officer at the Office of the State Bank Commissioner, said the agency supervises 165 state-chartered banks, 31 bank trust departments and 12 separate trust companies that together manage about $210,000,000,000 in assets. Becker said the agency operates with 114 authorized full-time positions and three vacancies and is fee-funded, asking for a fiscal 2025 budget described in testimony as $13,757,000,000 (fee funded; no state general fund).

Becker said Kansas uses the CAMELS framework (capital, assets, management, earnings, liquidity and sensitivity) to rate institutions on a scale of 1 to 5 and that only a small share of state-chartered banks received ratings of 2, 3 or 4 at the end of 2024. He described a six-year trend of a declining number of state-chartered banks (down about 13% since 2019) while total bank assets in Kansas rose roughly 28% over the same period.

Why it matters: Becker told senators the combination of fewer banks and larger asset…