Treasury huddles with Fed and FDIC to streamline bank oversight.

Treasury huddles with Fed and FDIC to streamline bank oversight.

The U.S. Treasury Department has convened a meeting with the Federal Reserve (Fed) and the Federal Deposit Insurance Corporation (FDIC) to discuss strategies for streamlining bank oversight. This initiative comes amidst ongoing efforts by the Office of the Comptroller of the Currency (OCC) to merge its bank supervision units into a single office [1].

The OCC's recent reorganization, announced on April 16, 2025, aims to streamline its supervision and examination division by combining large, midsize, and community bank supervision units into a single entity. This move is part of a broader effort to enhance efficiency and expertise sharing within the agency [1].

The Treasury Secretary Scott Bessent, speaking at the New York Economic Club in March, expressed a focus on making financial regulation more efficient, although he did not explicitly endorse the consolidation of entire banking agencies [1]. This meeting with the Fed and FDIC is seen as a step toward achieving this goal.

The potential merger of U.S. bank regulators has been a topic of debate, with steep political, institutional, and industry interests opposing such a move. The fragmented regulatory system, rooted in Civil War-era legislation, has made consolidation a challenging task [1]. However, the OCC's reorganization signals a willingness to address inefficiencies and improve oversight.

A February survey of senior community bankers conducted by Intrafi found that while a majority of bankers strongly support regulatory independence, opinions on merging federal banking agencies are nearly evenly split [1]. This meeting between the Treasury, Fed, and FDIC is an attempt to address these concerns and find common ground.

The outcome of this collaboration remains to be seen, but it is clear that the focus on streamlining bank oversight is a priority for the administration. As the financial regulatory landscape continues to evolve, these efforts aim to ensure that oversight remains robust, efficient, and responsive to the needs of the banking sector.

References:
[1] https://www.americanbanker.com/news/occ-combines-supervision-into-single-unit