Statement by FDIC Acting Chairman Travis Hill at September 2025 Meeting of the Financial Stability Oversight Council

Over the past eight months, the FDIC has been working to improve its regulatory and supervisory approach across a number of different areas.

We are working to reform supervision so it is less process-driven and more focused on core financial risks. This work currently includes, among other items:¹

• First, working on an interagency rulemaking to define certain key terms to impose guardrails on, and improve the consistency of, the supervisory process;
• Second, working to reform the CAMELS rating system, including by amending the definitions of the component ratings, with a goal of shifting the emphasis towards financial risks and away from process;
• Third, issuing a proposal to revamp our supervisory appeals process;²
• Fourth, modifying our continuous exam program, including by raising the threshold from $10 billion to $30 billion in assets;
• Fifth, reducing the frequency of consumer compliance exams to once every five years, with a midcycle review, for most institutions with less than $3 billion in assets;³
• Sixth, streamlining aspects of our BSA⁴ and IT exams;⁵
• Seventh, modifying our enforcement policy to allow termination of enforcement orders when an institution has achieved "substantial compliance";⁶
• Eighth, ending the use of disparate impact in fair lending exams;⁷ and
• Ninth, reevaluating our consumer compliance complex bank program.

With respect to capital rules, we:

• Issued a joint proposal to modify the enhanced supplementary leverage ratio;⁸
• Continue to work on a reproposal to modernize risk-based capital standards; and
• Are analyzing potential changes to the community bank leverage ratio (CBLR).

With respect to digital assets, we:

• Rescinded Biden-era "prior notification" requirements;⁹
• Provided clarity that banks may engage in permissible crypto-asset activities;¹⁰
• Publicly released hundreds of pages of supervisory correspondence to provide transparency regarding the prior administration's misguided approach to digital assets; and
• Have begun work to implement the GENIUS Act and recommendations from the President's Working Group on Digital Asset Markets.

With respect to bank resolution, we:

• Issued FAQs to shift the focus of resolution planning for large regional banks based on lessons learned from the 2023 bank failures;¹¹
• Are in the midst of a "bidder outreach" process to engage with prospective bidders for failed banks, as part of a broader effort to improve our bidding process;
• Issued updated FAQs on Part 370 recordkeeping to provide a path for achieving "substantial compliance" with the rule;¹² and
• Are reevaluating numerous other aspects of our resolution and receivership management functions.

With respect to ending debanking,¹³ we are, among other things:

• Working on a rulemaking to prohibit examiners from (1) criticizing institutions on the basis of reputational risk or (2) requiring, directing, or encouraging institutions to close customer accounts on the basis of political, social, cultural, or religious views;¹⁴ and
• Conducting reviews of our supervised institutions for evidence of unlawful debanking, consistent with the President's Executive Order on fair banking.¹⁵

Finally, we are doing work in a number of other areas, including:

• Issuing a proposal to raise and index 37 regulatory asset thresholds,¹⁶ and evaluating additional steps on a range of other asset thresholds;
• Rescinding our 2024 statement of policy on bank mergers,¹⁷ and working on additional improvements to the merger review process and analytical framework;
• Continuing to explore ideas for encouraging more de novo bank activity;¹⁸
• Issuing a proposal to significantly enhance the speed and certainty of the approval process for new branch openings;¹⁹ and
• Rescinding the 2023 Community Reinvestment Act rule.²⁰

Altogether, our goal is to unleash the banking system to drive economic growth and access to capital, while still fulfilling our critical role promoting safety and soundness and financial stability.