At a press conference with U.S. Rep. Andy Barr and Kentucky coal and firearms industry representatives, Comptroller of the Currency Jonathan V. Gould discussed the Office of the Comptroller of the Currency’s report on debanking by the nine largest national banks it supervises. He highlighted findings that reputation risk policies allowed political considerations, public opinion and social pressure to influence access to financial services rather than relying on objective, risk based criteria. The review found policies restricting financing for new or expanded coal mining operations and coal fired power plants, including limits based on companies’ reliance on coal revenue. Several banks also restricted financing for firearms manufacturers and retailers, and one declined to assist a firearms business with an initial public offering because its lawful sales policies did not match the bank’s standards. Gould reiterated that banks need not serve every customer but should assess customers using objective, risk based criteria, noting that the OCC has removed reputation risk from its supervisory framework and sees further work as necessary to address debanking.
United States Office of the Comptroller of the Currency highlights coal and firearms restrictions in large bank debanking review
Comptroller of the Currency Jonathan V. Gould highlighted findings that large banks used reputation risk policies to restrict services to coal and firearms businesses based on public or political pressures rather than objective financial risk. He said banks may choose their customers but should apply objective, risk based criteria, and noted that the OCC has removed reputation risk from its supervisory framework.