OCC’s Bank Threshold Change Puts System at Risk, Critics Warn

A federal banking regulator’s proposal to subject only a handful of the largest national lenders to enhanced supervisory standards is an overreaction that puts the entire banking system at risk, opponents say.

The Office of the Comptroller of the Currency, which oversees national banks, in December proposed applying heightened standards to lenders with at least $700 billion in total assets, raising the current $50 billion threshold.

The OCC says the change is necessary to free smaller banks from tough oversight, including requirements for banks’ boards to be heavily involved in risk management, while maintaining tight standards for the largest lenders. ...