• The OCC, Federal Reserve, and CFPB have recently postponed, scaled back, or canceled bank examinations, people familiar with the matter say.
  • The pullback follows President Trump's executive orders targeting disparate impact liability and reducing anti-competitive regulatory barriers.
  • Regulators have also rescinded previous crypto guidance and restructured examination units, creating operational uncertainty for banks.

Federal banking regulators have quietly begun postponing, scaling back, or outright canceling scheduled bank examinations, according to multiple people familiar with supervisory plans, marking a significant operational shift following the Trump administration's recent executive orders on deregulation.

The Office of the Comptroller of the Currency, Federal Reserve, and Consumer Financial Protection Bureau have all adjusted their examination calendars in recent weeks, though the changes have not been formally announced. The moves reflect a broader effort to reduce regulatory burdens on financial institutions that has accelerated since April.

"We had a full-scope fair lending exam scheduled for next month that's now been reduced to a targeted review," said one compliance officer at a midsize bank who asked not to be identified discussing regulatory matters. "They're clearly operating under new directives."

The OCC has been particularly active in restructuring its approach. The agency confirmed it will merge its Midsize/Community Bank and Large Bank Supervision functions into a new Bank Supervision and Examination unit starting June 2, 2025. While designed to enhance resource sharing and consistency, the reorganization has created temporary disruption as examiners adapt to new processes.

More significantly, on July 14, the OCC ceased supervising banks for disparate impact liability and removed all related references from its fair lending examination manual. This action directly implements President Trump's executive order targeting the elimination of such liability across federal agencies. The move effectively narrows fair lending enforcement to cases of intentional discrimination.

The CFPB has undergone similar changes, restructuring its enforcement priorities to focus solely on clear consumer harm rather than broader interpretations of unfair practices. The agency recently reached settlements on litigation tied to its previous expansion of unfair practice classification under the UDAAP exam manual.

Spokespeople for the OCC, Fed, and CFPB did not immediately respond to requests for comment on the examination changes.

In parallel developments, both the Fed and OCC have rescinded previous policy statements that imposed specific risk management expectations on banks engaging with cryptocurrency assets. The reversal signals a more favorable regulatory stance toward digital assets under the current administration and comes as several major banks explore expanded crypto custody and trading services.

While the examination pullback may reduce immediate compliance costs for banks, it creates uncertainty about long-term supervisory expectations. Some institutions are proceeding cautiously, maintaining existing compliance programs despite the reduced federal scrutiny.

"We're not making drastic changes yet because we still have state exams and private litigation risk," said another bank executive. "But the federal pressure has definitely eased."

The regulatory retreat has drawn criticism from consumer advocates who argue that diminished oversight could expose vulnerable borrowers to discriminatory practices. Without federal disparate impact enforcement, consumers must rely on state attorneys general and private lawsuits to challenge potentially discriminatory lending outcomes.

Bank trade groups have generally welcomed the changes, though some have expressed frustration that the administration's intent to rescind certain rules hasn't always translated to formal compliance delays. Several groups have specifically sought delays in implementation dates for the CFPB's open banking rule, arguing that banks shouldn't incur costs for rules likely to be overturned.

As federal regulators step back, attention is turning to whether state regulators will expand their oversight role. The Conference of State Bank Supervisors recently called for reversal of federal preemption policies, but the OCC has reaffirmed its commitment to maintaining national regulatory standards.

The examination changes represent the most concrete implementation to date of the administration's deregulatory agenda, moving beyond policy statements to actual supervisory practice. How permanent these shifts become may depend on both legal challenges and the outcome of future elections, creating a complex compliance landscape for financial institutions navigating between changing federal and state priorities.