{"text":[[{"start":0,"text":"US banking regulators are narrowing their enforcement and supervision standards to put greater emphasis on material financial risk."}],[{"start":15.1,"text":"The Office for the Comptroller of the Currency and the Federal Deposit Insurance Corporation on Thursday announced a new set of rules centred on “refocusing supervision on what matters most — material financial risk”."}],[{"start":27.48,"text":"The overhaul is part of a wider deregulatory push under the Trump administration that has also led regulators to scrap “reputational risk” from their supervisory framework in order to prevent what they view as unfair “debanking”."}],[{"start":40.2,"text":"The agency said it was removing “Biden-era distractions” that caused bank examinations to often become a “check-the-box compliance exercise” instead of focusing on the most important financial risks that endanger banks."}],[{"start":52.8,"text":"The revamp includes the issuance of a new definition for the term “unsafe or unsound practice”, which was previously open to interpretation. It also sets a higher bar for the issuance of “Matters Requiring Attention”, the formal notices that regulators send to banks to correct deficiencies."}],[{"start":70,"text":"The increased focus on material risk comes after US regulators came under fire for their failure to address interest rate and liquidity risks at Silicon Valley Bank, which failed in 2023, even though its regulators at the Federal Reserve had issued several notices about the bank’s governance, controls and anti-money laundering risks."}],[{"start":89.04,"text":"The notices to Silicon Valley “should have been about the actual risks to the bank rather than a random assortment”, said a regulator involved in the joint action. Under the new rules, the OCC and the FDIC would likely stop issuing notices for minor infractions such as violations of the regulators’ IT handbook, he added."}],[{"start":107.44,"text":"“We’re causing us and the banks to focus on risks that matter to them most: risks that affect their balance sheet significantly, their liquidity,” the regulator said. He added the agencies’ aim was to make sure “executives at the bank [were] not focused on myriad compliance exercises” instead."}],[{"start":122.88,"text":"The OCC also said it would make its policies and procedural manual public for the first time in a bid to foster transparency and accountability. It also highlighted a more demanding supervisory approach for large or complex banks, saying enforcement actions against such banks would not necessarily trigger a similar response for smaller community banks."}],[{"start":144,"text":"It said it would establish two distinct categories of legal and regulatory violations: “substantive” and “technical” violations. It will now seek to address non-substantive violations outside the formal written notice system."}],[{"start":157.48,"text":"“It is critical that examiners and institutions prioritise material financial risks and substantive violations of law over concerns related to policies, process, documentation and other non-financial risks,” OCC head Jonathan V Gould said."}],[{"start":173.24,"text":"The American Bankers Association, a trade group representing banks, welcomed the overhaul. President and chief executive Rob Nichols said the changes would “bolster the safety and soundness of banks of all sizes and help them better serve their customers, clients and communities by providing more consistency and predictability”."}],[{"start":195.58,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1787885061_7003.mp3"}