Understanding the Office of the Comptroller of the Currency or OCC

The Office of the Comptroller of the Currency (OCC) is a crucial component of the United States’ financial regulatory framework. Established to ensure the safety and soundness of the national banking system, the OCC plays a vital role in maintaining the stability and integrity of the country’s financial institutions. By understanding the OCC, you can gain insights into how the U.S. banking system operates and why this regulatory body is essential for economic stability. Learn more in this short guide to the Office of the Comptroller of the Currency.

What is the OCC or the Comptroller of the Currency?

The OCC, or Office of the Comptroller of the Currency, is an independent bureau within the U.S. Department of the Treasury. It was established by the National Currency Act of 1863 (passed by Congress and signed into law by President Abraham Lincoln), which was later revised as the National Bank Act. The primary mission of the OCC is to charter, regulate, and supervise all national banks and federal savings associations. Additionally, it supervises the federal branches and agencies of foreign banks operating in the United States.

The mission, vision and values of the OCC

The OCC’s mission

To ensure that national banks and federal savings associations operate in a safe and sound manner, provide fair access to financial services, treat customers fairly, and comply with applicable laws and regulations.

The OCC’s vision

The OCC is the leading US prudential supervisor that:

• adds value through proactive and risk-based supervision
• is sought after as a source of knowledge and expertise
• promotes a vibrant and diverse banking system that benefits consumers, communities, businesses, and the U.S. economy.

The OCC’s values

• Integrity: Firm adherence to a code or standard. We do the right thing, conducting ourselves in accordance with the law, policies, and the highest ethical standards.
• Expertise: Mastery in one’s field; unique or specialised knowledge or skill. We continuously enhance our leadership and technical skills and experience, act on careful analysis, and apply our knowledge and capabilities to achieve the agency’s mission.
• Collaboration: Working together to achieve a common goal. We include diverse stakeholders in our decision-making, seek alternative perspectives, and excel in a team environment.
• Independence: Freedom from undue influence or control of others.

What does the OCC do? The role and responsibilities of the OCC

Chartering national banks

One of the OCC’s fundamental responsibilities is to charter national banks. This process involves granting a federal charter to new banking institutions, allowing them to operate under the national banking system. The OCC ensures that these banks meet rigorous standards and are capable of operating in a safe and sound manner.

Regulating and supervising banks

The OCC is tasked with regulating and supervising over 1,200 national banks and federal savings associations. This involves conducting regular examinations to assess the financial health, risk management practices, and compliance with applicable laws and regulations. By doing so, the OCC helps maintain public confidence in the banking system.

Ensuring compliance

Compliance with laws and regulations is critical for the stability of the banking system. The OCC ensures that national banks adhere to a wide range of legal requirements, including consumer protection laws, anti-money laundering regulations, and fair lending practices. This oversight helps protect consumers and ensures that banks operate ethically and transparently.

Promoting fair access and financial inclusion

The OCC is committed to promoting fair access to financial services and enhancing financial inclusion. It works to ensure that underserved communities have access to banking services and that national banks engage in responsible lending practices. This commitment is essential for fostering economic growth and reducing disparities in access to financial resources.

Departments and offices in the OCC

There are several departments and offices sitting under the leadership of the Comptroller.

• Bank Supervision Policy – develops supervision policies, provides accounting guidance, and supports community development. BSP covers credit, market, operational, compliance risks, capital and accounting policies, and community affairs.
• Chief Counsel’s Office – its primary mission is to provide high-quality, timely support for the agency’s goals and strategic objectives.
• Large Bank Supervision – oversees the largest and most complex national banks, federal savings associations, and federal branches of foreign banks. These banks typically have assets ranging from USD $50 billion to USD $3 trillion.
• Midsize and Community Bank Supervision – ensures midsize and community banks operate safely, provide fair financial access, treat customers fairly, and comply with laws.
• Office of Enterprise Governance and the Ombudsman – ensures strong governance and handles complaints and appeals independently, reporting directly to the Comptroller to fairly address consumer and banker issues.
• Office of Management / CFO –  provides strategic planning, financial, facilities, IT, and human capital support services to the agency.
• Office of Minority and Women Inclusion – established in 2011, implements section 342 of the Dodd–Frank Act. OMWI’s Executive Director and team set standards to:
  • Increase minority- and women-owned business participation in OCC programmemes and contracts.
  • Promote equal employment opportunity and workforce diversity at the OCC.
  • Assess diversity policies and practices of OCC-regulated banks.
• Office of Public Affairs – manages the OCC’s communications and external affairs, including congressional and banking relations, press relations, internal communications, outreach, disclosure services, editorial, design and print services, and web and digital services.
• Supervision Risk and Analysis – supports the OCC’s supervision mission with economic & policy analysis, economics & risk analysis, office of climate risk, supervision system & analytical support, and systemic risk identification and support.

Why the OCC Matters

The OCC’s role in maintaining the safety and soundness of the national banking system cannot be overstated. Key reasons include:

Strategic Goals of the OCC for 2023-2027

Agility and learning

• Foster a culture of adaptability and continuous learning.
• Promote diversity, equity, inclusion, and accessibility.
• Enhance critical thinking skills and adaptive mindset.
• Improve information flow and reduce silos within the agency.
• Update talent management strategies to attract and retain a diverse workforce.

Credibility and trust

• Safeguard public trust by ensuring a safe, sound, and fair banking system.
• Strengthen communication and feedback mechanisms.
• Increase transparency in actions, processes, and decision-making.
• Engage strategically with stakeholders on complex banking issues.
• Hold all levels accountable for credibility, reliability, and trust.

Leadership in supervision

• Enhance risk-based supervision to adapt to evolving banking activities and technologies.
• Integrate fairness with safety and soundness in the banking system.
• Invest in research and innovation for emerging challenges like climate risk and digital technologies.
• Deepen collaboration with domestic and international regulators.
• Support community banks, focusing on small businesses and underserved communities.

The future of the OCC

As the financial industry continues to evolve, the OCC faces new challenges and opportunities. The rise of fintech, digital currencies, and evolving cybersecurity threats requires the OCC to adapt its regulatory approach. By staying ahead of these trends and fostering a forward-thinking regulatory environment, the OCC can continue to safeguard the banking system while encouraging innovation and growth.

The Office of the Comptroller of the Currency plays a pivotal role in the U.S. financial system. By chartering, regulating, and supervising national banks, the OCC ensures the stability, integrity, and fairness of the banking sector.

Understanding the OCC’s functions and significance can help individuals and businesses appreciate the importance of effective financial regulation. As we look to the future, the OCC’s adaptability and commitment to its mission will remain crucial in maintaining a robust and resilient banking system.

For more information on the OCC and its activities, visit the official OCC website.