Regulators hold back in February, with 70% fewer final/proposed rules

Federal financial institution regulators issued less than a third of the proposed or finalized regulations in February that they have, on average, issued in the same month over the previous three years, according to a tally of Federal Register notices from Feb. 1-28.

While the five regulatory agencies are nominally independent agencies – and thus nominally not affected by President Donald Trump’s Jan. 20 executive order placing a freeze on regulations – the tally of three rules finalized or proposed, compared to 10 on average for the previous three years — shows that the agencies are nonetheless complying with the spirit of the order.

According to the tally, the National Credit Union Administration issued one proposal, and the Federal Reserve System issued two finals. On average for February, the combined agencies of the have issued 10 final or proposed regulations in each of the previous years (2014-16).

During the month of February for the years 2014-16, the Fed, NCUA, Office of the Comptroller of the Currency (OCC), Federal Deposit Insurance Corp. (FDIC) and Consumer Financial Protection Bureau (CFPB) have issued a combined 31 final or proposed rules. The Fed is the leader in promulgating rules in February, with 13 issued over the three-year period; NCUA is the least active, with only two rules over previous Februarys.

February was the first full month affected by the Jan. 20 order from the Trump Administration. The freeze order requires that new rules that have been sent to the Federal Register but not yet published be immediately withdrawn. Rules that have been published but have not yet taken effect are postponed for 60 days.

Additionally, the order mandates that federal agencies “send no regulation to the Office of the Federal Register (the ‘OFR’) until a department or agency head appointed or designated by the President after noon on January 20, 2017, reviews and approves the regulation.” The department or agency head may delegate this power of review and approval to any other person so appointed or designated by the President, consistent with applicable law, the order stated.

To date, only one of the federal financial institution regulators counts a Trump-appointed or designated “agency head”: the NCUA. On Jan. 26, Trump designated Republican J. Mark McWatters “acting chairman” of the NCUA Board (swapping out the chairman at the time, Democrat Rick Metsger – who remains on the board as a “member,” the position McWatters formerly held).

The 60-day rule postponement continues through March 21.