NEW YORK — U.S. bank regulators are scaling back examinations and relying less on formal disciplinary notices, signaling a lighter supervisory approach under President Donald Trump’s administration, according to more than a half-dozen industry executives who were interviewed by Reuters.
Reuters noted that in recent months, the Office of the Comptroller of the Currency, the Federal Reserve and the Consumer Financial Protection Bureau have postponed or reduced the scope of some exams.
“While the shift is most pronounced on non-core issues such as reputational risk, climate risk and diversity initiatives, in some cases it extends to broader oversight,” the analysis stated.
According to Reuters, supervisors are using narrower, rulebook-based language to define exams and leaning less on formal “matters requiring attention” letters, long criticized by banks as excessive. Instead, regulators are issuing informal guidance to nudge lenders toward fixing problems.
Broader Push
Reuters said the changes reflect a broader push by Trump-appointed officials to return supervision to key financial metrics — including capital, liquidity and risk management — and scale back oversight of environmental, social and governance issues. Staffing shortfalls due to layoffs and a federal hiring freeze have also contributed to fewer exams, sources told Reuters.
The report noted the adjustments follow heightened scrutiny after the failures of three lenders in 2023. Democrats and some regulatory experts argue supervisors should take a holistic approach to bank risk and warn that weaker oversight could invite new problems, the report added.
“The OCC is reexamining its supervisory approach to ensure it conforms to its statutory mission and reflects a risk tolerance enabling banks to support economic growth,” the agency said in a statement to Reuters. The Fed declined to comment, and the CFPB did not respond.
CEO of Large Bank a Vocal Critic
Reuters further noted that JPMorgan Chase CEO Jamie Dimon has been among the most vocal critics, warning in October 2024 that supervisors were missing liquidity problems while burdening banks with irrelevant requirements. “We are suing our regulators over and over and over, because things are becoming unfair and unjust,” Dimon said.
