Alert May 31, 2011

OCC Issues Notice of Proposed Rulemaking to Prepare for Integration of OTS on July 21, 2011

The OCC issued a notice of proposed rulemaking (the “Proposal“) that would modify certain OCC regulations to facilitate the OCC’s assumption from the OTS, on July 21, 2011, of supervisory authority over federal savings associations (“FSAs”).  The OCC states that it will modify its regulation in several phases to integrate FSAs, and that the first phase would amend OCC regulations “that will be central to internal agency functions and operations immediately upon the transfer of supervisory jurisdiction for [FSAs].”  The Proposal also includes certain changes designed to reflect modifications to banking laws mandated by the Dodd-Frank Act including: (i) implementation of a moratorium until July 21, 2013 on changes in control of credit card banks and trust banks if the change would result in control by a “commercial firm”; (ii) the permanent increase of deposit insurance coverage to $250,000; (iii) changes to the OCC’s rules regarding preemption and visitorial powers (discussed in detail in the lead article of today’s issue of the Alert).

The Proposal also would amend the OCC’s assessment fee rule to include FSAs.  Comments on the Proposal are due to the OCC by June 27, 2011.