Exam fees may be latest fight in regulatory reform

In September, the House passed an appropriations bill including a measure that seeks to put all three federal regulators – the Fed, the OCC and the FDIC – onto appropriations. This could open the door to higher exam fees because if regulators are forced to go though the congressional appropriations process, it could potentially increase their costs to cover their own supervisory activities. In other words, the bill could restrict their budgeting and force them to seek more revenue … in the form of higher exam fees. The OCC already charges assessments for federally chartered institutions, which cover the agency’s operating costs including exam fees.

The FDIC and FRB could be incentivized to charge a fee too. However, the bill included a provision that allows the FDIC to reduce exam fees based on the amount banks already pay in deposit insurance premiums. These premiums have dropped in recent years, so they may not cover exam fees, thereby leading to increased fees. The biggest impact could be on state-chartered banks supervised by the Fed.

Moreover, the bill appears to exempt credit unions, possibly because NCUA successfully lobbied to exclude credit unions from the appropriations process.

The OCC supervises 1,400 national banks and thrifts. The Fed currently oversees 828 state member banks and the FDIC supervises 3,356 state nonmember banks.

For more information, contact your Rehmann advisor today.

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