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Witness for the OCC tells committee of plans to reshape supervision, pursue stablecoin rules and ease burdens on community banks
Summary
An unnamed OCC witness told the committee the agency will refocus supervision on material risks, repropose Basel III capital rules, streamline Community Reinvestment Act compliance, advance BSA/AML modernization, and draft rules to integrate payment stablecoins while protecting access to banking services.
An unidentified witness for the Office of the Comptroller of the Currency told the committee the agency will reset its supervisory approach to emphasize material financial risks and relieve burdens on community banks.
The witness said the OCC will "restore balance, reset our risk tolerance, focus supervision on material financial risks, and free banks to lend, invest, innovate, and grow responsibly." The testimony said the OCC supervises more than 1,000 institutions holding about $6.7 trillion in assets, or roughly two-thirds of U.S. commercial banking assets, framing the scope of the agency's authority.
Why it matters: The witness framed the changes as shifts away from a one-size-fits-all post-crisis model toward a more proportional regime for smaller institutions and as a way to encourage innovation. "The Genius Act represents Congress's effort to integrate payment stable coins safely into our regulated banking and financial system," the witness said, and added that the OCC is "drafting rules that balance innovation with prudence."
The witness described specific areas of work. The OCC is coordinating with interagency partners to repropose the Basel III capital rulemaking and said it is "evaluating opportunities to improve the Community Reinvestment Act framework, including developing a simplified strategic plan to ease compliance for community banks." The witness also said the agency is advancing Bank Secrecy Act/anti-money-laundering modernization with "targeted burden relief for community institutions." These changes aim to simplify regulatory architecture while maintaining capital and compliance standards.
On access and fairness, the witness said the agency has proposed a rule to "eliminate reputation risk from supervision" and pledged that banks should offer products and services "based on objective risk based criteria, not politics or ideology." The witness framed this as implementing the president's executive order on guaranteeing fair banking and as part of reviews of the activities of the largest national banks and investigations of alleged debanking complaints.
The OCC official framed innovation and new technology — including AI — as opportunities the agency intends to make available across its supervised banks rather than to a privileged few. The witness said operational modernization through technology and data should also yield lower assessment fees, intending cost savings to flow back to banks and their customers.
The OCC did not provide a timeline for final rules on Basel III reproposal, CRA changes, or the reputation-risk proposal; the witness said these initiatives are under active development and are being coordinated with interagency partners.
The hearing record shows the OCC is prioritizing a mix of deregulatory tailoring for community banks, capital-rule reproposals, and rulemaking to integrate stablecoins while emphasizing continued prudential oversight.
