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Across the regulatory agency landscape

The FDIC approved a proposal to withdraw a bank merger policy adopted in 2024.

The proposal, which has been approved by the FDIC board, aims to address concerns that the policy statement added uncertainty to the merger application process. The FDIC's policy statement was aimed at providing greater scrutiny of transactions involving nonbanks, pro forma institutions with more than $100 billion in assets or institutions with adverse Community Reinvestment Act ratings.

The FDIC said it will temporarily reinstate its earlier merger policy statement and embark on a comprehensive reevaluation of its bank merger review process, with a 30-day comment period for the proposal following its publication in the Federal Register.

Additionally, the FDIC board withdrew a proposal concerning brokered deposits, which could have significantly impacted the deposit landscape, as well as proposals related to corporate governance and incentive-based compensation arrangements.

The brokered deposits proposal had received pushback from the banking industry and would have required more deposits to be classified as brokered, including those originated by originated by financial technology partners. The corporate governance proposal would have resulted in "overly prescriptive and process-oriented" expectations for management and boards of FDIC-supervised institutions with $10 billion or more in total assets, the agency said.

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National Credit Union Administration Chairman Kyle Hauptman announced the agency will cease the public disclosure of individual credit unions' overdraft and non-sufficient fund fee income.

During a recent discussion at the 2025 Governmental Affairs Conference, Hauptman said the decision to stop publishing this data is intended to prevent unintended consequences that could arise from consumer protection policies aimed at limiting excessive fees. He noted that the previous requirement for federally insured credit unions with over $1 billion in assets to disclose these fees could discourage them from serving low-income and underserved communities.

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The FDIC postponed the compliance deadline for certain provisions of its sign and advertising rule.

The delay particularly affects the requirements for displaying the FDIC's official sign on digital platforms of insured depository institutions and the provisions related to ATMs, according to a March 3 release.

Originally set for May 1, 2025, full compliance with the amended signage regulations will now be required by March 1, 2026.

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The OCC reported that 140 employees accepted deferred resignation buyouts as part of ongoing job cuts under the Trump administration, Bloomberg Law reported, citing an internal email acquired by the news outlet.

The employees who accepted the buyout will be placed on administrative leave while remaining on the federal payroll until September, the report said.

The number of departures adds to the 76 probationary employees that the OCC laid off in February, primarily affecting its midsize and community bank supervision unit. Before these reductions, the OCC employed approximately 3,600 individuals, the report said, citing the Office of Personnel Management.

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US Treasury Secretary Scott Bessent is positioning the department to take a prominent role in the Trump administration's deregulatory efforts, emphasizing the need for coordinated financial regulation, The Wall Street Journal reported, citing Bessent's remarks at The Economic Club of New York.

Bessent outlined plans for the department to lead an initiative aimed at shifting the focus of financial regulators toward significant financial risks instead of mere compliance, the report said. He also addressed reports from the WSJ regarding discussions among Trump administration officials about consolidating federal banking agencies, clarifying that the goal is not to merge agencies but to enhance coordination through the Treasury.

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President Trump signed an executive order officially establishing a strategic bitcoin reserve and a stockpile for other cryptocurrencies.

The order mandates the Treasury secretary to create an office responsible for managing the strategic bitcoin reserve, which will consist of bitcoin acquired through forfeiture proceedings and not needed for other governmental uses. Additionally, a United States Digital Asset Stockpile will be established to manage other digital assets obtained through similar means.

The Treasury secretary and the secretary of Commerce Department are tasked with developing budget-neutral strategies for acquiring more Bitcoin, while the government will not seek additional digital assets outside of forfeiture actions without further legislative or executive approval.

Further, agencies are required to report their holdings of digital assets to the Treasury secretary within 30 days, ensuring a comprehensive accounting of government-owned Bitcoin and other digital assets. The order also outlines that no government digital assets can be sold or disposed of without proper authorization, emphasizing responsible stewardship.

Source: Various

Anti-CBDC bill reintroduced

House Majority Whip Tom Emmer (R-Minn.) reintroduced legislation restricting the ability of the federal government to introduce a central bank digital currency. A similar bill passed the House during the last Congress.

The CBDC Anti-Surveillance State Act (H.R. 5403):

• Prohibits the Federal Reserve Banks from offering products or services directly to individuals, maintaining individual accounts, or issuing a CBDC to individuals or through an intermediary.
• Prohibits the Federal Reserve and the Federal Open Market Committee from using a CBDC to implement monetary policy.

Source: ICBA

Bill to raise CTR, SAR reporting thresholds

The Financial Reporting Threshold Modernization Act (H.R. 1799) would raise the CTR and SAR thresholds to $30,000 and $10,000, respectively, and index the CTR threshold for inflation every five years.

In a letter to the bill’s sponsors, ICBA said CTR and SAR filings are a primary source of community bank compliance burden and expense, diverting resources that could be better directed toward community lending. H.R. 1799 follows the recommendations of a recent GAO report required under the Anti-Money Laundering Act of 2020 to reduce the number of unused CTRs filed by community banks by adjusting the Bank Secrecy Act reporting thresholds.

Current reporting thresholds under the BSA are significantly outdated and capture far more transactions than originally intended, noting that the CTR and SAR thresholds have not been adjusted since 1972 and 1992, respectively.

Source: ICBA

House, Senate versions of ACRE Act

Community bankers across the nation thanked the sponsors of the Senate and House versions of the Access to Credit for our Rural Economy (ACRE) Act, expressing strong support for the bipartisan legislation.

The ACRE Act would:  

• Provide farmers, ranchers and rural homeowners with lower-cost credit.  
• Allow producers to improve their cashflow positions at a time of tremendous economic stress in the farm sector.  
• Enable family farmers to remain on their farms and ranches, preventing further consolidation within the farm sector.  
• Offer community banks flexibility to work with struggling family farmers and ranchers.  

ICBA along with ACB and 43 state banking associations sent letters to senators and representatives asking them to sponsor S. 838 and H.R. 1822. The groups also asked that members of Congress support including the bipartisan ACRE Act in the upcoming tax bill.

Source: ICBA

Economic outlook for Arkansas downgraded

The Federal Reserve’s latest Beige Book report indicates flat economic activity in Arkansas, the Arkansas Democrat-Gazette report. 

• The St. Louis Fed, which serves an eight-state district, downgraded its outlook from slightly optimistic to neutral 
• Businesses across the district cited rising labor and non-labor costs as profit pressures, according to the report
• Consumer spending declined slightly, with mixed retail performance; some retailers gained market share, while others saw weaker demand

Farmers struggling: Agricultural conditions worsened, with tariffs, trade policy uncertainty, and Farm Bill concerns weighing on farmers; some expect zero profits or have exited the industry.

ICE impact: A Little Rock construction company reported workforce shortages due to recent deportations.

Source: Arkansas Business; Arkansas Democrat-Gazette, Federal Reserve St. Louis

An article from ICBA

Striking Balance

“Without a doubt, advocacy serves as the most critical piece

of our mission in 2025. With a shift in control in Congress

and the White House, our focus will be on regulatory relief and proportionate rulemaking.”

In this article Rebeca Romero Rainy, ICBA president and CEO expresses "ICBA's recommitment to the pillars of advocacy, innovation and education, and embracing their potential."

Click here to learn more.

Source: SouthState Bank

Banking industry head count falls again

The banking industry shed workers in the fourth quarter of 2024 for the seventh straight quarter.

The industry reported 2.1 million employees in the fourth quarter of 2024, down 0.2% from the prior quarter. Despite recording fewer employees, banks' noninterest expenses rose during the same period, worsening efficiency ratios.

Efficiency ratios worsened for the US banking industry in the fourth quarter of 2024. The ratio, which measures the amount of overhead cost required per dollar of operating revenue, is calculated by dividing noninterest expenses by the sum of net interest income and noninterest revenue. Banks have greater efficiency as the ratio approaches zero.

Noninterest income, net interest income and noninterest expense each rose sequentially in the fourth quarter, but the expense increase outpaced income increases, leading to deteriorated efficiency ratios. The industry posted a 0.8-percentage-point aggregate rise in efficiency ratio and a 2.9% increase in adjusted noninterest expenses for the quarter.

Source: S&P Global Market Intelligence

Credit union acquisitions of banks slowing

Credit union acquisitions of banks have slowed in early 2025 due in part to community banking industry opposition.

The article notes that credit unions acquired a record 22 banks in 2024, but only one such acquisition has been announced so far this year as banking industry opposition has raised questions over whether these transactions would receive required regulatory approvals. It also notes that members of Congress have mulled the idea of requiring credit unions to pay federal income tax.

In a recent Washington Post op-ed, former FDIC Chair Sheila Bair wrote that it is time for Washington to reexamine credit union tax subsidies as Congress considers tax reform this year.

Source: ICBA; Washington Post