Determining how best to analyze the effects of its regulatory actions on the banking industry, consumers, and the financial system – and do so in a transparent manner – is the aim of a recent request for information (RFI) issued by the Federal Deposit Insurance Corp. (FDIC) with a public comment deadline of Jan. 28.
The FDIC said it is considering ways to improve the quality of its analysis of regulatory actions. “A transparent analysis of the effects of regulatory actions is an important part of credible rulemaking. It supports good policy decisions and the meaningful involvement and trust of the public in the rulemaking process,” according to a statement from FDIC Chairman Jelena McWilliams.
The RFI was published in the Federal Register Friday and noted in a release issued by the agency Tuesday. The approaches being considered are consistent with and support efforts to apply the FDIC’s “Statement of Policy on the Development and Review of Regulations,” the agency noted. “In broad terms, the FDIC is considering a more structured approach to regulatory analysis and one that incorporates a number of analytical practices identified in standard references. Comments received on this RFI will be of assistance to the FDIC in strengthening its analysis of the effects of regulatory actions,” it stated.
The RFI provides background on the various statutory requirements addressing regulatory review and analysis, and it draws from other, current federal government guidance on such analyses, including an Office of Management and Budget (OMB) circular (Circular A-4) that does not apply to the FDIC (since it is an independent agency) but which the FDIC finds useful. It also includes a discussion of how rule analyses are presented in rulemakings by banking agencies in particular, which may publish rules on their own or jointly with others.
Regarding the substance of regulatory analysis, the FDIC said it is interested in commenters’ broad views, and examples of analytical approaches, or sources of data or other information “that may assist in the analysis of specific rules or classes of rules.” Topics of interest include but are not limited to the following.
- Appropriate concepts for identifying the broad economic benefits and costs of changes in bank regulation;
- Effects of changes in regulations on the safety and soundness of banks;
- Effects of changes in regulations on the incidence of consumer harm;
- Effects of changes in regulations on the achievement of the FDIC’s statutory objectives regarding failure resolution or the deposit insurance system;
- Ways to achieve statutory mandates in the most efficient and effective manner;
- Approaches to anticipating potential unintended consequences of regulatory changes;
- Effects of changes in regulations on the cost and availability of bank credit or other financial services;
- Effects of changes in regulations on the direct and indirect costs banks incur to comply with these regulations;
- How to evaluate the effects of changes in banks’ compliance responsibilities on the achievement of statutory objectives regarding safety and soundness, consumer protection or other matters;
- Effects of changes in the cost and availability of bank financial services on U.S. economic output;
- Effects of changes in bank regulation on the frequency or severity of bank failures or banking crises, and consequent effects on U.S. economic output; and
- Distributional effects of changes in bank regulation.
The FDIC is also seeking comment on the use of accounting tables to summarize a rule analysis.