Forvis Mazars has summarized this month’s activity in the U.S. banking regulatory landscape to help you keep up to speed on this quickly evolving regulatory environment.
The U.S. banking regulatory landscape remained active in July, with significant developments on the legislative, supervisory, and international fronts. On Capitol Hill, legislation was signed to set into motion the integration of digital assets into the traditional financial system, with the movement toward the regulation of payment stablecoins and the establishment of a digital market structure. In addition, lawmakers advanced a reconciliation bill with provisions that will bring widespread change across the economy. The Office of the Comptroller of the Currency (OCC), the Federal Reserve Board (FRB), and the FDIC (collectively, banking agencies) continue to discuss and refine frameworks regarding digital assets, the Community Reinvestment Act (CRA), and regulatory reporting guidance, while also independently working on developing a more tailored regulatory system. Read about this—and more—in the following summary of activities in the U.S. banking regulatory ecosystem.
Navigating the Evolving U.S. Banking Regulatory Landscape: Key Highlights From July 2025
The U.S. banking regulatory environment saw significant developments in July 2025, spanning legislative, supervisory, and international fronts. Here are the quick hits:
- Legislative Milestones
- The Guiding and Establishing National Innovation for U.S. Stablecoins Act (GENIUS Act) was signed into law, establishing frameworks for stablecoin regulation.
- The Digital Asset Market Clarity Act of 2025 (CLARITY Act) was advanced, setting the stage for a new market structure for digital assets.
- The One Big Beautiful Bill Act (OBBBA) introduced sweeping changes that will impact financial institutions.
- Joint Agency Actions
- Banking agencies sought public input on reducing regulatory burdens and proposed rescinding the 2023 CRA final rule.
- A joint statement emphasized risk management for crypto-asset safekeeping, reaffirming existing supervisory expectations.
- Federal Reserve Updates
- The Federal Open Market Committee (FOMC) maintained interest rates amid moderated economic growth and persistent inflation.
- Proposed revisions to the supervisory rating framework aim to better align with the strength of large financial institutions.
- OCC Initiatives
- Removal of disparate impact references in fair lending guidance aligns with a new executive order.
- Cybersecurity and operational resilience remain top priorities.
- The OCC Semiannual Risk Perspective identifies trends in key risks, economic operating environment, and bank performance.
- FDIC Developments
- A proposal was issued to reduce burden by indexing key FDIC audit and reporting thresholds for inflation.
- Streamlined branch relocation processes are proposed.
- A new Office of Supervisory Appeals is proposed to enhance the appeals process for supervisory determinations.
- SEC & CFTC Updates
- The SEC approved in-kind creations and redemptions for crypto exchange-traded products (ETPs), aligning them with traditional commodity-based ETPs.
- The Commodity Futures Trading Commission (CFTC) extended no-action relief for certain reporting obligations and emphasized artificial intelligence’s (AI) role in market compliance and supervision.
- FASB Updates
- FASB advanced updates to 34 issues in the Accounting Standards Codification.
- Key clarifications include accounting for earnings per share during losses, Treasury stock retirement, and lease receivables excluded from enhanced disclosure requirements.
- Proposed amendments aim to improve transparency and consistency in financial reporting.
- International Insights
- The Basel Committee explored risks associated with banks’ interconnections with non-bank financial intermediaries, highlighting the need for robust data and monitoring.
On Capitol Hill
The GENIUS Act was passed by the U.S. House of Representatives and signed into law by President Donald Trump on July 18. The GENIUS Act creates a regulatory framework that permits banks and non-banks to issue payment stablecoins and enables their integration into the financial system. For more information, see our FORsights™ article, “GENIUS Act – Ushering in a Transformative Era of Digital Assets.”
The CLARITY Act was passed by the House on July 17. This legislation aims to define a digital market structure, clarifying the roles of the SEC and CFTC in regulating the offer and sale of digital commodities, which are defined as digital assets whose value is derived from the use of blockchain technology. This act is a critical step toward resolving jurisdictional ambiguity and fostering market confidence.
On July 4, Trump signed House Resolution 1, known as OBBBA, which introduced sweeping changes across the economy and potential impacts for financial institutions. The OBBBA is designed to modernize the federal tax and regulatory framework to kick-start private investment, lower borrowing costs, and spark economic growth. It provides targeted incentives from agricultural interest exclusions and enhanced depreciation to permanent community investment credits while streamlining compliance and reporting obligations. Furthermore, the bill recalibrates consumer-finance oversight, student loan programs, and excise taxes in attempts to balance revenue and strengthen market protections. For more on OBBBA, see our article, “Congress Passes Reconciliation Bill.”
Joint Agency Statements
Federal Bank Regulatory Agencies Seek Further Comment on Interagency Effort to Reduce Regulatory Burden
On July 21, the banking agencies announced a notice requesting public comment to reduce regulatory burden. The action comes as part of a mandate of the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA), which requires the agencies to assess their regulations at least once every 10 years to identify outdated, unnecessary, or overly burdensome rules. Comments are requested for certain regulations in the following categories: banking operations, capital, and CRA. The public has until October 23 to submit feedback. In addition, the agencies will hold public outreach meetings—dates are to be determined.
Agencies Issue Joint Proposal to Rescind 2023 CRA Final Rule
On July 18, the banking agencies published in the Federal Register a joint proposal to rescind the CRA final rule issued in 2023, and replace it with the prior CRA regulations with certain technical amendments. The action, backed unanimously by the FDIC board of directors, aims to restore certainty in the CRA regulatory framework and limit regulatory burden on banks. The public comment period ends on August 18, 2025. For more information, see our article, “U.S. Banking Agencies Reverse Course on the Community Reinvestment Act (CRA).”
Agencies Issue Joint Statement on Risk-Management Considerations for Crypto-Asset Safekeeping
On July 14, the banking agencies released a joint statement regarding the provision of crypto-asset safekeeping services. The statement did not introduce any new supervisory expectations. Rather, it reaffirmed how existing laws and regulations apply to the safekeeping of crypto assets and emphasized the importance of prudent risk management for this activity. For more on crypto-asset safekeeping, see our article, “Crypto-Asset Safekeeping.”
A Summary of Call Report Revisions
On July 11, the banking agencies jointly issued reporting changes to all three versions of the Call Reports, i.e., Federal Financial Institutions Examination Council (FFIEC) 031, FFIEC 041, and FFIEC 051, as well as the Report of Assets and Liabilities of U.S. Branches and Agencies of Foreign Banks (FFIEC 002) to implement changes in response to FASB’s Accounting Standards Update (ASU) 2022-02 on troubled debt restructurings. Institutions must now report loan modifications to borrowers experiencing financial difficulty for a 12-month period following the modification. The changes take effect December 31, 2025, with early adoption permitted for the September 30, 2025 report date. Institutions can provide comments on these changes through August 11, 2025.
On July 10, the banking agencies jointly issued reporting revisions to align Call Report instructions with the recent changes to the enhanced supplementary leverage ratio (eSLR) and other capital-related rules. These changes, impacting only FFIEC 031, reflect the revised eSLR framework for global systemically important banks (GSIBs), which now requires a minimum of 3% plus 50% of the GSIB surcharge. In addition, the agencies updated reporting instructions to help ensure consistency with the revised capital rule definitions and risk-based capital thresholds. The proposed revisions to the Call Report forms and instructions would become effective on the first reporting date following the effective date of the eSLR capital proposal, if finalized. Public comments on the proposed changes must be submitted by September 8. For more information, see our article, “U.S. Banking Agencies Revise the Enhanced Supplementary Leverage Ratio.”
Federal Reserve Board
An Overview of the Federal Open Market Committee Meeting
On July 30, the FOMC concluded its two-day meeting and provided updates on its interest rate strategy in an open meeting. The July report points to moderated economic growth, low unemployment, and favorable labor market conditions; however, inflation remains above targets and uncertainty about the economic outlook remains elevated. As a result, interest rates remained unchanged as the FOMC decided to maintain the federal funds rate target range between 4.25% and 4.50%. Notably, while the decision received majority support, two members of the Board of Governors dissented in favor of a 0.25% interest rate cut.
Chair Jerome Powell reaffirmed the focus on a dual mandate to maximize employment and stabilize prices. The long-term impact of recent tariffs remains one of the primary drivers of pressure and uncertainty on price stability. In the Q&A portion of the meeting, Powell kept the messaging consistent, declining to speculate what the FOMC would do with interest rates during its September address.
A Summary of the Latest Beige Book
On July 16, the Federal Reserve issued its latest Beige Book, a publication detailing the current economic conditions across the 12 Federal Reserve districts. In this release, the districts experienced modest to flat economic activity for the period between late May and early July as businesses remained conservative amid policy uncertainty. The labor market showed very slight job growth and modest wage increases. However, increasing input costs driven by tariffs and other policy changes led firms to pass higher prices on to consumers. The next Beige Book is expected to be released in September.
Proposed Revisions to the Supervisory Rating Framework for Large Bank Holding Companies
On July 10, the Federal Reserve requested comment on a proposal to revise its “Large Financial Institution” (LFI) supervisory rating framework for large bank holding companies. The aim of the proposed revisions is to better align the supervisory rating framework with the strength of bank holding companies and the banking system holistically. Furthermore, the changes seek to better align the LFI rating system with the supervisory rating systems.
In general, the proposal focuses on redefining the “Well Managed” under the LFI rating system. Under the proposal, an organization with at least two “Broadly Meets Expectations” or “Conditionally Meets Expectations” component ratings and no more than one “Deficient-1” component ratings would be considered “Well Managed.” An organization would not be considered “Well Managed” if it receives a “Deficient-1” for two or more component ratings or if it receives a “Deficient-2” for any of the component ratings. Further, the proposal removes the presumption that one or more “Deficient-1” component rating will result in informal or formal enforcement action. Instead, the nature and circumstances of any findings would be considered before the determination of formal or informal enforcement action is made. Comments on the proposal are due on August 14.
Office of the Comptroller of the Currency
The OCC Removes References to Disparate Impact
On July 14, the OCC issued Bulletin 2025-16, Fair Lending: Removing References to Disparate Impact, which removed references to disparate impact in fair lending guidance, including the Comptroller’s handbook. This action was taken to align with Presidential Executive Order (EO) 14281, Restoring Equality of Opportunity and Meritocracy, which directs agencies to eliminate the use of disparate-impact liability in all contexts. The OCC also is in the process of removing references to disparate impact from all supervisory materials. Furthermore, the agency will no longer conduct examination procedures to assess disparate-impact liability, including—but not limited to—disparate-impact risk, internal disparate-impact risk analysis, or disparate-impact risk assessment processes or procedures.
Jonathan Gould Takes Office as the 32nd Comptroller of the Currency
On July 10, Jonathan Gould was confirmed by the U.S. Senate and officially appointed as the 32nd Comptroller of the Currency. Gould returns to the OCC after previously serving as the agency’s senior deputy comptroller and chief counsel. In his opening statement, Gould spoke on the upcoming strategic priorities of the agency, which includes ensuring a safe-and-sound banking system, improving bank supervision and regulation, embracing innovation, and promoting fair access to the financial services areas of technological innovation and supervision.
The OCC Releases the Cybersecurity & Financial System Resilience Report
On July 3, the OCC released the Cybersecurity and Financial System Resilience Report, an annual report to Congress describing the OCC’s measures to strengthen cybersecurity with respect to its regulatory functions, as well as maintain the integrity of the agency’s internal systems. Cybersecurity and operational resilience are high-priority issues for the OCC, as well as the other banking agencies, and will remain key priorities for the foreseeable future.
With greater complexities in the operating environment and the increasing sophistication of cyberthreats, institutions are reminded to strengthen their defenses against cyberattacks and enhance their ability to recover from disruptive incidents. Furthermore, as institutions rely more heavily on external vendors and technology partners, developing and refining the third-party risk management framework is encouraged.
The OCC Releases Its Summer Semiannual Risk Perspective
In the final days of June, the OCC released the summer issue of the OCC Risk Perspective, a report that identifies trends in key risks, economic operating environment, and bank performance. The report indicates that despite uncertainty from elevated interest rates, geopolitical tensions, and softening of macroeconomic indicators, the federal banking system remains fundamentally sound.
However, the agency highlights additional risk considerations for institutions:
- Commercial credit risk is increasing, which is compounded by refinance exposures from loans originated in the low-interest-rate environment.
- Retail credit remains steady despite shifting consumer sentiment; however, a deceleration in wage growth and growing economic uncertainty could adversely impact consumer sentiment in the near future.
- Net interest margins have improved as funding costs declined with cuts to the effective federal funds rate; however, the agency urges robust scenario analysis and sensitivity testing to combat uncertainty around inflation and future interest rate movement.
- Operational risk remains elevated as banks look to modernize legacy systems, counter more sophisticated cyberthreats, and enhance third-party frameworks.
- Compliance risk remains high for anti-money laundering and consumer protection frameworks amid increased fraud and upticks in fintech partnerships, among others.
Federal Deposit Insurance Corporation
Outcomes From the FDIC’s Open Session
On July 15, the FDIC Board of Directors held an open session to discuss various regulatory matters. In addition to a farewell address issued by FDIC Board Member and Acting Comptroller of the Currency Rodney Hood, several proposals were advanced. Below, we provide an overview of each rulemaking that came out of the meeting.
FDIC Board of Directors Proposes to Establish Office of Supervisory Appeals
The FDIC Board of Directors advanced a proposal that would amend the agency’s Guidelines for Appeals of Material Supervisory Determinations. Under the FDIC’s current supervisory appeals process, after failed attempts at resolution of material supervisory determinations with the on-site examiner and/or leadership within their respective Regional Office, an institution may appeal to the Supervision Appeals Review Committee (SARC), an FDIC Board-level committee consisting of one appointed inside FDIC Board member, i.e., chairperson of the SARC, and two deputies to render a final decision on the matter. The proposed framework seeks to replace the SARC with a newly formed Office of Supervisory Appeals (Office). The Office would operate as an independent, standalone function, whose sole responsibility will be to review and resolve appeals. Public comments are requested on or before September 16.
FDIC Proposes Regulatory Threshold Adjustments & Indexing to Reflect Inflation
The FDIC Board of Directors approved issuance of a notice of proposed rulemaking (NPR) that would update regulatory thresholds to index key audit and reporting thresholds to reflect historical inflation for the following regulations:
- 12 CFR Part 303: Filing Procedures;
- 12 CFR Part 335: Securities of State Nonmember Banks and Savings Associations;
- 12 CFR Part 340: Restrictions on Sale of Assets of a Failed Institution by the Federal Deposit Insurance Corporation;
- 12 CFR Part 347: International Banking;
- 12 CFR Part 363: Annual Independent Audits and Reporting Requirements; and
- 12 CFR Part 380: Orderly Liquidation Authority.
Under the draft indexing rule, thresholds tied to asset‐size tests, audit triggers, reporting requirements, cross‐border activity limits, and liquidation caps would receive a one-time reset based on cumulative changes in the consumer price index (CPI) since their last calibration. Thereafter, benchmarks would adjust automatically every two years, or sooner if inflation exceeds 8%, mirroring the CPI-W indexing mechanism used in the CRA. These large increases are based on calculations of the CPI-W for the number of years since the initial thresholds were set.
If adopted, the rule could provide relief of certain regulatory burdens for institutions and shift how banks measure and manage key compliance triggers moving forward. Public comments are requested for each proposal on or before September 26. For more information, see our article, “FDIC Considers New Policy for Updated Regulatory Thresholds.”
FDIC Board Approves Request for Information on Industrial Banks & Industrial Loan Companies & Their Parent Companies & Withdrawal of Proposed Rule
The board voted unanimously to release an RFI to review its process for approving applications submitted by industrial loan companies (ILCs) and their parent companies. The move comes on the heels of an uptick in ILC charter applications, particularly by automakers. Although no immediate regulatory changes are proposed, the FDIC will use submitted insights to shape future supervisory standards with hopes of striking a balance between safety and soundness and the operational flexibility that ILCs often require. The agency requests that public comments be submitted on or before September 19.
Separately, the board issued a notice to withdraw a proposed amendment to FDIC Part 354, which would have revised the criteria the FDIC considers when assessing risks presented to an ILC by its parent organization and evaluating its ability to function independently of the parent organization and to meet the needs of the communities where it does business. The FDIC no longer intends to issue a final rule with respect to this proposal.
FDIC Board of Directors Approves Notice of Proposed Rulemaking on the Establishment & Relocation of Branches & Offices
The FDIC Board of Directors issued an NPR to streamline the process for establishing and relocating domestic branches and offices. Under the proposed rule, formal filings for de minimis branch facility changes and public notice requirements would no longer be required for eligible institutions (as defined by 12 CFR 303.2(r)). In addition, eligible institutions could receive expedited automatic approval within three business days for intrastate branch filings and main office relocations. The proposed rule would apply to insured state non-member banks and insured branches of a foreign bank applying to move from one location to another. Public comments are requested for this proposal on or before September 16.
The FDIC Releases Its 2025 Consumer Compliance Supervisory Highlights
On July 3, the FDIC issued its 2025 Consumer Compliance Supervisory Highlights, providing a view into the agency’s consumer compliance supervisory activities. Furthermore, the report provides a high-level overview of consumer compliance issues, examination findings, and enforcement actions identified during the 2024 examination cycle. The report may be found on the FDIC website.
The FDIC Issues List of Banks Examined for CRA Compliance
On July 3, the FDIC released its periodic statement presenting the results of the FDIC-regulated banks evaluated for CRA compliance. In total, 71 institutions were assessed during the period. For a complete list of banks examined for CRA compliance, visit the FDIC website.
Consumer Financial Protection Bureau (CFPB)
On July 21, the CFPB withdrew the direct final rule issued on May 21, 2025. The rule would have the rescinded procedures that a state official must follow when notifying the CFPB that the official has taken an action to enforce the Consumer Financial Protection Act. The direct final rule was rescinded because significant adverse public comments were received during the comment period.
Securities & Exchange Commission
SEC Approves In-Kind Creations & Redemptions for Crypto ETPs
On July 29, the SEC approved an order to permit in-kind creations and redemptions by authorized participants for crypto asset ETPs. Under the approval order, authorized investors are allowed to exchange bitcoin and ether ETP shares directly for the underlying crypto assets, departing from the previous mechanism that was limited to creations and redemptions in cash only. The move aligns crypto ETPs with traditional commodity-based ETPs, like gold and oil, and has the potential to be less costly and more efficient for investors, issuers, and intermediaries.
In addition, the SEC advanced the following initiatives to standardize the treatment of crypto-based products: exchange applications seeking to list and trade a mixed spot bitcoin and ether ETP, options and Flexible Exchange options on certain spot bitcoin products, and a position limit increase of up to 250,000 contracts for options on bitcoin ETPs. In addition, two scheduling orders were issued seeking public comment on whether national securities exchanges should be allowed to list and trade two large-cap, crypto-based ETPs.
A Summary of the SEC Small Business Capital Formation Advisory Committee Meeting
On July 22, the SEC’s Small Business Capital Formation Advisory Committee held a meeting to continue its discussion of potential enhancements to Regulation A, an exemption that allows companies (particularly small and midsize businesses) to raise public capital without registering with the SEC.
In addition, the committee continued discussions on “finders,” described as entities that connect businesses with private investors. In an ongoing effort to promote small business capital formation, the committee is exploring issues surrounding “finders” in hopes to develop a regulatory solution, including—but not limited to—potential principles, frameworks, and safeguards to guide the permissible activities for “finders.”
As of this writing, the committee has not issued formal recommendations to the SEC on these matters.
Commodity Futures Trading Commission
CFTC Withdraws Advisory on Prime Brokerage Arrangements
On July 18, the CFTC’s Division of Clearing and Risk issued Staff Letter No. 25-22, formally withdrawing Staff Letter No. 23-06, which provided guidance on prime brokerage arrangements and derivatives clearing organization (DCO) registration under Part 1a(15). Moving forward, any entity involved in a prime brokerage or omnibus clearing structure must independently assess whether it meets the statutory definition of a futures commission merchant or other registrable entity. DCOs should evaluate membership applications and ongoing compliance without reference to the withdrawn advisory.
CFTC Issues No-Action Letter Extension Regarding Position Aggregation Requirements
On July 18, the CFTC’s Division of Market Oversight issued Staff Letter No. 25-21, extending the no-action positions most recently issued in Staff Letter No. 22-09 with respect to certain position aggregation requirements under Commission Regulation 150.4. At the joint request of the Futures Industry Association, Securities Industry and Financial Markets Association (SIFMA) Asset Management Group, and the Managed Funds Association, the relief is to cover instances where market participants miss filing aggregation exemption notices or submit incomplete disaggregation requests under Regulation 150.4(b) and (c). This extension remains in effect until the later of the effective date or compliance date of any forthcoming rulemaking that formally codifies these aggregation exemptions.
CFTC Issues No-Action Letter Extension Regarding Counterparties Clearing Swaps Through Relief DCOs
On July 9, the CFTC’s Division of Market Oversight issued Staff Letter No. 25-18, granting no-action relief to counterparties clearing swaps through exemptive order DCOs from certain Part 45 reporting obligations. Specifically, relief is provided for failure to report continuation data after acceptance for clearing, creation, and continuation data for swaps resulting from clearing-related compression. Furthermore, relief is granted for generating Unique Transaction Identifiers, provided that all original swap information is supplied to the DCO under the clearing agreement. This relief remains in effect until December 5, 2025, or until earlier revocation or modification, effectively extending the framework established by Staff Letter No. 22-18 and offering continuity for market participants navigating evolving clearing and reporting requirements.
CFTC Issues Advisory on Referrals for Potential Criminal Enforcement
On July 9, the CFTC’s Division of Enforcement issued an advisory under Executive Order 14294, Fighting Overcriminalization in Federal Regulations, detailing its new framework for referring potential criminal regulatory offenses to the U.S. Department of Justice (DOJ). The advisory directs staff to weigh factors such as the harm or risk posed by the alleged violation, any financial or other gain to the defendant, the defendant’s industry-specific expertise or licensure, evidence of awareness of unlawful conduct and the applicable rule, any history of repeat misconduct, and whether DOJ involvement would offer additional protections to derivatives market participants. Currently, there is no majority vote to authorize Federal Register publication.
Artificial Intelligence in Financial Markets: Enhancing Compliance, Supervision, & Enforcement, Remarks of Commissioner Kristin N. Johnson
In a recent address at George Washington University, CFTC Commissioner Kristin Johnson highlighted the transformative potential of AI in the financial markets and stressed that firms remain fully accountable for compliance, data integrity, and risk governance when deploying AI tools. Johnson noted that regulators are leveraging “suptech,” i.e., supervisory technology, to assist in market surveillance and risk detection, while also warning of AI-related vulnerabilities such as synthetic data, data leakage, deepfakes, data accuracy, and data security, among others. Johnson underscored the need for clear frameworks and comprehensive safeguards to help ensure AI innovations strengthen market integrity and protect investors.
Financial Accounting Standards Board
FASB Proposes Codification Improvements
At its July 23 meeting, FASB voted to proceed with plans for updates to 34 issues in the Accounting Standards Codification. The changes seek to clarify how companies account for a range of issues, including earnings per share when there is a loss from continuing operations; excess Treasury stock retirement; and certain lease receivables that the board said should be excluded from enhanced disclosure requirements, according to the tentative decisions outlined by FASB. FASB also affirmed decisions related to the adoption of proposed amendments to Topic 260, Earnings Per Share; the transition of all other proposed amendments; and effective dates and early adoption. See the FASB Quarterly Update from Forvis Mazars.
On the International Front
Basel Committee on Banking Supervision (BCBS) Explores the Risks Associated With Banks’ Interconnections With Non-Bank Financial Intermediaries
On July 10, the BCBS published a horizon scanning report on the interconnections between banks and non-bank financial intermediaries (NBFIs). As NBFI activity across the industry continues to increase, the report serves as a reminder of the potential risks posed by banks’ interconnections with NBFIs and provides scenarios that illustrate possible effects that NBFI failures could have on the financial stability of the banking system. The report also explores the importance of granular, timely, and high-frequency data in understanding and monitoring linkages between banks and NBFIs.
How Forvis Mazars Can Help
In the heavily regulated banking industry, leaders face more challenges than ever, from managing shareholder and regulatory expectations to pursuing digital innovation. Forvis Mazars can help your financial institution tackle issues inherent to the industry, including market growth, internal control threats, industry consolidation, and compliance. We have the skills and experience in financial services that you can trust. Combine our focus on Unmatched Client Experience® with the resources of a global firm, and you will find that Forvis Mazars is the trusted adviser your institution needs. Serving you is our passion and privilege.
If you have any questions or need assistance, please reach out to a professional at Forvis Mazars.