Marginal assessment rates reduced for national banking institutions in 2019

A 10% reduction in marginal assessments charged to national banks, federal savings associations, and federal branches and agencies of foreign banks to pay for federal supervision is in place for 2019, the national bank regulator announced Friday.

The Office of the Comptroller of the Currency (OCC) said the change takes effect with the March 31, 2019, assessment, and is expected to reduce total assessments collected by more than $90 million in 2019.

OCC says the reduction in marginal rates reflects cost savings in the agency’s operations and projections of its costs and revenue. The agency has also revised its refund policy so that institutions that leave the federal banking system during an assessment period will not be required to pre-pay for three months of supervision after they are no longer subject to OCC jurisdiction.

The agency also says it’s making no inflation adjustment to assessment rates for the 2019 assessment year.

These and more details on next year’s assessment schedules are provided in OCC Bulletin 2018-43, also issued Friday. The bulletin says that, as of Jan. 1:

  • Assessments are due March 31 and Sept. 30, based on call report information as of Dec. 31 and June 30, respectively, and cover the six-month periods beginning Jan. 1 and July 1, respectively. For example, the assessment due March 31 covers the period Jan. 1 through June 30.
  • The OCC sends the assessment invoice, which includes the calculated assessment fee due, and drafts the fee amount on March 31 and Sept. 30. The OCC gives seven business days’ notice of the amount to be drafted from an institution’s designated account. The institution is responsible for ensuring the account is funded properly on the due dates.
  • The OCC continues to charge interest on all payments received after the due date. The interest rate charged is the U.S. Treasury’s current value of funds rate published quarterly in the Federal Register.
  • National banks, federal savings associations, and federal branches and agencies of foreign banks that are no longer subject to OCC supervision on or before Dec. 31, 2018, or June 30, 2019, are not subject to the semiannual assessment for the period beginning Jan. 1 or July 1, respectively.
  • Institutions that leave the federal banking system after Dec. 31, 2018, or June 30, 2019, and before March 31, 2019, or Sept. 30, 2019, respectively, will pay the full six months and then receive a refund of the second half of their semiannual assessment. Those leaving the system after March 31, 2019, or Sept. 30, 2019, respectively, will be subject to the full semiannual assessment for the assessment period.

The surcharge for institutions requiring increased supervisory resources is to capture the cost of supervising those rated 3, 4, or 5 under the Uniform Financial Institutions Rating System. OCC says the surcharge will be determined in tandem with the asset-based assessment on Dec. 31, 2018, and June 30, 2019. Increases or decreases in ratings after Dec. 31, 2018, and June 30, 2019, will be reflected in the subsequent assessment period.

The OCC continues to reduce the assessment of “nonlead” national banks, federal savings associations, and federal branches and agencies of foreign banks by 12%. This includes a bank, savings association, or federal branch or agency that is not the largest in asset size, controlled by a company owning two or more national banks, federal savings associations, or federal branches or agencies of foreign banks.

The 12% discount does not apply to the independent trust bank assessment or the independent credit card bank assessment, the bulletin notes.

Applicable fee schedules are provided in the bulletin.

OCC Reduces Assessments for Regulated Banks and Savings Associations

OCC Bulletin 2018-43