OCC Proposes Rule to Ensure Fair Access to Bank Services

Earlier this month, the Office of the Comptroller of the Currency (OCC) proposed a rule to ensure national banks, federal branches, and agencies of foreign bank organizations provide fair banking services to customers, without discrimination. The proposal would solidify more than a decade of OCC guidance asserting that banks should use risk assessment of individual customers—instead of broad decisions or assumptions about customer categories—to provide access to capital, credit, and other banking services.

The proposal states that banks should be blind to social-justice or political implications, and should focus on numbers rather than serving one industry over another. 

The rule would require banks to make every financial service they offer in a geographic market available to all customers “on proportionally equal terms,” according to American Banker. To justify denying access, a bank must rely on a customer’s “quantified and documented failure to meet quantitative, impartial risk-based standards established in advance by the covered bank,” said the OCC. 

The agency’s rule would also formally ban banks from denying service to one sector to the advantage of another. Additionally, banks may not deny service to limit or prevent a customer from competing in a business or market segment. 

The proposal uses language from Title III of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which expanded the OCC’s responsibility to provide fair access separately from fair treatment. 

“The Dodd-Frank Act of 2010 added to the OCC’s traditional mission of safety and soundness the obligation to ensure fair access to financial services,” said Brian P. Brooks, Acting Comptroller, in a Wall Street Journal opinion piece. “The proposed rule defines fair access and explains how the agency proposes to regulate banks covered by the rule.” 

“Fair access is not only a legal requirement of the Dodd-Frank; it is a principle that reflects two centuries of American commitment to ensure that chartered banks don’t abuse their public trust by granting politically motivated special access to credit and capital,” Brooks continued.