Establishing a “rich set of data points and measurements capturing trends in and drivers of the consumers’ trust in banking” is the goal of a public survey proposed Friday by the regulator of national banks, as outlined in a speech the previous day by the leader of that agency.
The Office of the Comptroller of the Currency (OCC) said the request for information (RFI) about the survey seeks public input on the possible scope of the survey, components and drivers of trust, and ways to assess and analyze survey results over time.
In a speech Thursday evening before the Woodstock Institute’s 50th Anniversary Celebration, Acting Comptroller of the Currency Michael Hsu previewed the release of the survey in discussing the public’s trust in banking. “Public trust in banks can enable a virtuous cycle between banks and the communities they serve,” Hsu said. “Customers who trust banks are more likely to use the regulated banking system rather than stashing their cash under their mattresses, relying on predatory lenders, or turning to alternatives like crypto.”
Conversely, Hsu said, low trust in banks leads to a vicious cycle, which he said increases banks’ fragility and cost of funding while reducing their capacity to meet loan demand. “Research suggests that the aggregate levels of deposits at banks that endure runs do not return to pre-run levels,” Hsu said. “In addition, banks that have material fairness and compliance deficiencies may face stiff civil money penalties, restrictions on growth, and sustained reputational damage, limiting their capacities to make loans and otherwise serve their customers and the economy.”
In Friday’s RFI, the OCC said that by surveying the public, it can use the results to identify areas where trust can be further enhanced and gain insight into the many aspects that are important to consider in working to maintain and enhance trust in banking and bank supervision.
The agency also said it intends to publish the main results of the annual survey in an OCC report. The results, the agency said, may be used to inform policymakers, bankers, and researchers about the trends and drivers of public trust in banking and bank supervision.