OCC sets the phase for upcoming ‘rely on banking’ study


Michael Hsu, acting director of the Office of the Comptroller of the Currency, stated the company is providing a “trust in banking” study to analyze the links in between clients’ rely on their banks and those banks’ stability.

Bloomberg News

Acting Comptroller of the Currency Michael Hsu stated Thursday that the company is looking for public discuss an upcoming study on client rely on their banks, a relocation that will enable banks, regulators and stakeholders to “hold each other accountable for safeguarding trust in … the banking system.”

Speaking in Chicago at an occasion sponsored by the Woodstock Institute, Hsu specified trust as “the willingness of a party to be vulnerable to the actions of another,” sand stated it is not just essential to banking relationships, however likewise important for making sure individuals do not rely on riskier and less-regulated bank-like items that can hurt their monetary wellness.

“There is a saying that what gets measured gets done,” Hsu stated. “By conducting an annual survey on trust in banking, my hope is that banks, regulators, and community organizations will be better able to hold each other accountable for safeguarding trust in banks and the banking system. Customers who trust banks are more likely to use the regulated banking system rather than stashing their cash under their mattresses, relying on predatory lenders, or turning to alternatives like crypto.”

Hsu kept in mind a significant top priority in OCC’s efforts to resolve fairness will be comprehending the scale and nature of the issue. That needs more thorough research study and information on rely on banking, he stated, and “bank regulatory agencies, central banks, and academics have tended to focus on specific segments of the population or have covered trust in banks tangentially as part of broader survey efforts.”

To resolve the research study space, the OCC has actually released a Request for Information Thursday to obtain public talk about its upcoming yearly study checking out rely on banking and guidance, an effort developed under the OCC’s 2023-2027 tactical strategy.

“The RFI seeks public input on the possible scope of the survey, components and drivers  of trust, and ways to assess and analyze survey results over time,” Hsu stated. “We value diverse stakeholder  feedback and encourage you and others to respond to the RFI during the comment period, which  extends into August.” 

Hsu restored his require the banking market to think about trust and fairness in banking, absence of which he stated can injure a company’s monetary wellness, and in many cases, warrant regulative action.

“Aggregate levels of deposits at banks that endure runs do not return to pre-run levels,” Hsu stated. “In addition, banks that have material fairness and compliance deficiencies may face stiff civil money penalties, restrictions on growth, and sustained reputational damage, limiting their capacities to make loans and otherwise serve their customers and the economy.”

Hsu likewise discussed the OCC’s efforts at revamping its executing policies for the Community Reinvestment Act. He revealed issue about a 2022 analysis by the Urban Institute that discovered CRA-eligible home loan and small company financing banks disproportionately provide in their CRA locations, leaving low- and moderate-income locations without a bank underserved.

“We must continue to encourage banks to do a better job of offering products and services and serving all communities fairly, especially LMI communities,” he stated to the crowd.

Hsu likewise repeated the requirement to reform banks’ overdraft cost practices and advised organizations to acquaint themselves with April released assistance on overdraft defense programs highlighting practices that OCC has actually suggested might verge on unreasonable or misleading like presume positive/settle unfavorable and representment costs. 

“In times of need, access to small dollar liquidity can be critical,” Hsu stated. “Over the years, overdrafts have grown to meet that need, but at a high cost to consumers and to trust in banks.”

The OCC prepares to release the primary study leads to a report, making it possible for policymakers, lenders, and scientists to remain notified about the patterns and chauffeurs of customer rely on the market. Additionally, the OCC stated it might produce more comprehensive reports on particular trust-related subjects.

By event insights from the general public on how to structure the upcoming study, the company stated it intends to recognize locations where trust can be more enhanced, and precisely assess customer rely on banking.

Comments on the company’s Request for Information needs to be gotten within 120 days after June 9, when it was released in the Federal Register.


A news media journalist always on the go, I've been published in major publications including VICE, The Atlantic, and TIME.

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