In testimony to the United States House of Representatives Committee on Financial Services, Federal Deposit Insurance Corporation Acting Chairman Travis Hill set out reforms intended to make supervision less process-driven and more focused on core financial risks. Recent changes include raising the presumptive threshold for the continuous examination process from USD 10 billion to USD 30 billion in assets and using a hybrid approach for banks between USD 10 billion and USD 30 billion. Consumer compliance and Community Reinvestment Act examinations for most well-rated institutions below USD 3 billion are being extended to multi-year cycles, with joint exams about every five years for banks with USD 350 million to USD 3 billion in assets and about every six years for banks below USD 350 million, in each case with a midcycle review. Rulemaking and policy items highlighted include an October joint proposal with the Office of the Comptroller of the Currency to define "unsafe or unsound practice" and to establish uniform standards for matters requiring attention and non-binding supervisory observations, and a July proposal to create a standalone Office of Supervisory Appeals for material supervisory determinations. Capital actions referenced a final rule with the Board of Governors of the Federal Reserve System and the Office of the Comptroller of the Currency modifying the enhanced supplementary leverage ratio for U.S. global systemically important bank holding companies and a proposal to amend the community bank leverage ratio by lowering the requirement from 9 percent to 8 percent and extending the grace period from two to four quarters subject to limits. On resolution, the FDIC has streamlined insured depository institution resolution plan submissions for the current cycle and is preparing amendments to the IDI Rule, while modernizing failed-bank marketing and auctions including a seller-financing program and a planned pre-qualification process for nonbank bidders. Other measures cited include revised standards for terminating cease-and-desist and consent orders based on "substantial compliance", a final rule raising and indexing more than twenty Part 363 thresholds tied to audit and internal control requirements, an FDIC/OCC proposal to prohibit examiner use of reputational risk and discourage account closures based on customers' views, and a shift to a more permissive approach to bank digital-asset activities. Next steps include finalizing guidelines establishing the Office of Supervisory Appeals and issuing a final rule in December 2025 to speed approvals for certain branch filings eligible for expedited processing. Under the Guiding and Establishing National Innovation for U.S. Stablecoins Act, the FDIC will license and supervise payment stablecoin-issuing subsidiaries of FDIC-supervised insured depository institutions and expects to propose an application framework in December 2025 and prudential requirements in early 2026. The testimony also pointed to a forthcoming interagency proposal to reform anti-money laundering and countering the financing of terrorism obligations under the Bank Secrecy Act and to ongoing reviews of comments on the CRA rollback and payment fraud initiatives.
Federal Deposit Insurance Corporation 2025-12-02
Federal Deposit Insurance Corporation sets out supervision reforms including a USD 30 billion continuous examination threshold and stablecoin rulemaking plans
In testimony to the U.S. House Committee on Financial Services, FDIC Acting Chairman Travis Hill outlined reforms to focus supervision on core financial risks, including raising the continuous examination threshold to USD 30 billion and extending examination cycles for smaller institutions. Key proposals include defining "unsafe or unsound practice," establishing an Office of Supervisory Appeals, and modifying leverage ratios for banks. The FDIC is also preparing to license and supervise payment stablecoin-issuing subsidiaries, planning to propose an application framework by December 2025.