Trump signs nullification of OCC bank merger guidelines

WASHINGTON — President Donald Trump on Friday evening signed a rule that officially eliminates the Office of the Comptroller of the Currency’s stricter reviews of certain bank mergers. 

Trump signed the Congressional Review Act resolution Friday nullifying the Office of the Comptroller of the Currency’s Biden-era rule that got rid of an expedited rule process for small banks, among other provisions. 

The OCC, then led by Acting Comptroller Michael Hsu, said the changes increased transparency in the merger review process. The changes came as part of a broader push by the Biden administration to scrutinize mergers. 

The CRA resolution was introduced by Sen. John Kennedy, R-La., in the Senate and Rep. Andy Barr, R-Ky., in the House. It passed through both chambers of Congress largely on party lines last month. 

“Small banks depend on mergers to grow, innovate, and better serve their communities,” said House Financial Services Committee Chairman French Hill, R-Ark., in a statement. “This resolution restores competition, consumer choice, and a more balanced regulatory approach.”

Trump’s signing of the resolution not only nullifies the OCC’s Biden-era merger guidelines but also bars the agency from undertaking any “substantially similar” rulemakings in the future without the approval of Congress. Whether a rule would meet that “substantially similar” standard, however, would likely be up to a court to decide. 

The OCC itself already rolled back some of these Biden-era guidelines under the leadership of acting Comptroller Rodney Hood, who was tapped to lead the agency on an interim basis in February. In May, the OCC issued an interim final rule rescinding a policy statement that mandated financial stability rules for any bank merger creating an institution with $50 billion in assets or more. 

Republicans in the 119th Congress have used CRA to nullify other Biden-era bank regulatory rules. In mid-May, Trump signed the Republican-led Congressional Review Act resolution overturning the Consumer Financial Protection Bureau rule that would have limited many overdraft fees. At the same time, he signed a separate CRA resolution for the CFPB’s larger participant rule, which would have let the bureau’s examiners determine whether digital payment providers that process at least 50 million transactions each year comply with the Electronic Fund Transfer Act, as well as other consumer protection laws.

And Republicans are pursuing other avenues to revive the shot clock on bank mergers. Barr has also introduced a bill that would put timing guardrails on the Federal Reserve when it comes to bank merger approval, tightening the timeliness requirements for the Fed to consider bank mergers and introduce much tougher standards for the central bank to meet once a merger application is submitted.

“Bank mergers create competition and efficiency in the banking system,” Barr said after Trump signed the CRA resolution. “By eliminating this rule, we will remove unnecessary guardrails on the bank merger process that make smaller and medium-sized banks less competitive. This is another win for President Trump, who is making our economy stronger by cutting government red-tape and unleashing the free market.” 

The signed CRA resolution also represents a win for banks, who have supported the idea of shortening turnaround times for bank merger approvals and who supported the initial CRA introductions. 

“The ABA submitted extensive comments on the proposed rule in April 2024,” the American Bankers Association said in a letter to House leadership in May. “The agency’s final rule, however, did not address several of the concerns outlined in ABA’s comments. Instead, the OCC created unhelpful new standards that lack transparency and necessary predictability that reflect a degree of bias against mergers.”