Regulatory Developments
The Federal Reserve has taken several policy actions since the publication of the November 2023 Supervision and Regulation Report (see table 1). All Supervision and Regulation (SR) and Consumer Affairs (CA) letters are available on the Federal Reserve Board's public website.17
Table 1. Federal Reserve or interagency rulemakings/statements (proposed and final)
| From 11/01/2023 to 05/03/2024 | |
|---|---|
| Date issued | Rule/guidance |
| 2/6/2024 | Federal bank regulatory agencies seek comment on interagency effort to reduce regulatory burden. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240206a.htm |
| 5/3/2024 | Agencies issue third-party risk-management guide for community banks. Joint press release: https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240503b.htm |
Third-Party Risk Management: A Guide for Community Banks
To supplement the broader third-party risk-management guidance issued in June 2023, the Federal Reserve Board, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency issued a third-party risk-management guide for community banks in May 2024.18 The guide is intended to assist community banks when developing and implementing their third-party risk-management practices. The guide is a supplementary resource consistent with other similar tools that have been provided to community banks focused on managing various aspects of these relationships.19 The guide provides potential considerations, resources, and examples through each stage of the third-party risk-management life cycle. The guide also references potential considerations and resources for related governance practices.
Economic Growth and Regulatory Paperwork Reduction Act of 1996
In February 2024, the Federal Reserve Board, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency (federal bank regulatory agencies) announced the first of a series of requests for comment to reduce regulatory burden.20 The Economic Growth and Regulatory Paperwork Reduction Act of 1996 requires the Federal Financial Institutions Examination Council and federal bank regulatory agencies to review their regulations every 10 years to identify any outdated or otherwise unnecessary regulatory requirements for their supervised institutions. The agencies divided their regulations into 12 categories and will be soliciting comments over the next two years. This first request solicits feedback on three categories: Applications and Reporting, Powers and Activities, and International Operations. Comments on the relevant regulations will be accepted for 90 days after publication in the Federal Register.
References
17. The Federal Reserve publishes SR and CA letters to address significant policy and procedural matters related to the Federal Reserve System's safety-and-soundness and consumer compliance supervisory responsibilities, respectively. SR letters are available on the Board's public website at https://www.federalreserve.gov/supervisionreg/srletters/srletters.htm, and CA letters are available on the Board's public website at https://www.federalreserve.gov/supervisionreg/caletters/caletters.htm. Return to text
18. See Board of Governors of the Federal Reserve System, "Agencies issue final guidance on third-party risk management," news release, June 6, 2023, https://www.federalreserve.gov/newsevents/pressreleases/bcreg20230606a.htm and "Agencies issue guide to assist community banks to develop and implement third-party risk-management practices," news release, May 3, 2024, https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240503b.htm. Return to text
19. See Board of Governors of the Federal Reserve System, Conducting Due Diligence on Financial Technology Companies: A Guide for Community Banks (Washington: Board of Governors, October 2023), https://www.federalreserve.gov/publications/files/conducting-due-diligence-on-financial-technology-firms-202108.pdf and Board of Governors of the Federal Reserve System, Community Bank Access to Innovation through Partnerships (Washington: Board of Governors, October 2023), https://www.federalreserve.gov/publications/files/community-bank-access-to-innovation-through-partnerships-202109.pdf. Return to text
20. See Board of Governors of the Federal Reserve System, "Federal bank regulatory agencies seek comment on interagency effort to reduce regulatory burden," news release, February 6, 2024, https://www.federalreserve.gov/newsevents/pressreleases/bcreg20240206a.htm. Return to text