The latest fine from regulators is expected to be leveled against the bank as early as Friday. But it's far from the only penalty it has paid in recent years, and more may be on the way.
The rules to comply with the Community Reinvestment Act have become "formulaic and ossified" and must be changed to encourage lending practices the law originally intended to foster, the Fed's top regulator said.
The Office of the Comptroller of the Currency has been leading the charge on revamping the Community Reinvestment Act, but a big unknown is whether the other two regulators charged with carrying out the law are committed to moving ahead as swiftly on a reform plan.
Comptroller of the Currency Joseph Otting took office only late last year, but he is wasting little time in tackling a series of hot-button topics, including easing anti-money laundering regulations and lowering national bank fees.
The bank revealed Friday that it is facing hefty regulatory penalties and will likely have to restate first-quarter earnings. Declines in loan balances and fee income and questions about upcoming stress tests are only adding to investors' worries.
The comptroller said he is looking to capitalize on the industry's strong profits and high capital reserves to reduce costs and lower exam fees next year.
Bank regulators have not even proposed a plan yet for revamping the Community Reinvestment Act, but stakeholders likely to weigh in on the plan are already establishing battle lines.
Comptroller of the Currency Joseph Otting laid out an ambitious regulatory reform agenda Monday, telling a group of community bankers that he is committed to CRA upgrades, new flexibility in BSA compliance and other measures.
