Under New Management: The Trump Administration Reshapes Federal Banking Supervision

By Lynn Woosley, Managing Director, Asurity Advisors

With the recent confirmations of Michelle Bowman as Vice Chair for Supervision at the Board of Governors of the Federal Reserve System and Jonathan Gould as Comptroller of the Currency, it is an opportune time to consider the probable regulatory priorities of the federal banking agencies in the Trump administration. This article provides an overview of Asurity Advisors’ estimation of common supervisory and regulatory priorities at the Federal Reserve (FRB), Office of the Comptroller of the Currency (OCC), Federal Deposit Insurance Corporation (FDIC), and Consumer Financial Protection Bureau (CFPB) based on recent agency publications, public remarks, and testimonies from agency leadership.

A common theme of newly appointed and acting leadership of federal financial institution regulators is an overarching deregulatory posture. Federal banking agencies have withdrawn prior rules, delayed the implementation of new regulations, and criticized rules deemed to have excessive burdens. Acting CFPB Director Russell Vought has suspended several rulemaking processes and rescinded regulatory guidance. When named FDIC Acting Chair, Travis Hill stated priorities including “a wholesale review of regulations, guidance, and manuals,” and ensuring “the FDIC remains within our statutory mandates and stops coloring outside the lines.”[1] The CFPB alone has rescinded more than five dozen Policy Statements, Interpretive Rules, Advisory Opinions, Consumer Protection Circulars, and Bulletins. Congress used the Congressional Review Act to overturn the CFPB’s Overdraft Rule and the Larger Participant rule for digital payment apps. Even financial crimes have not been exempted from burden reduction efforts. FinCEN delayed applying Bank Secrecy Act requirements to investment advisors[2] and permitted banks to use third parties to collect Tax Identification Numbers.[3] Other examples of regulatory burden reductions include the removal of reputational risk and disparate impact from examination manuals, the OCC’s withdrawal from the interagency Principles for Climate-Related Financial Risk Management for Large Financial Institutions,[4] and rescission of several rules and proposals, including:

The CFPB Notice of Proposed Rulemaking: Protecting Americans from Harmful Data Broker Practices;
The FDIC 2024 Statement of Policy on Bank Merger Transactions;
The OCC 2024 rule on Business Combinations Under the Bank Merger Act; and
The CFPB 2021 Protections for Borrowers Affected by the COVID-19 Emergency Under the Real Estate Settlement Procedures Act (RESPA).

In addition, the FRB, FDIC, and OCC have emphasized tailoring supervisory and regulatory expectations by institution size and complexity. Comptroller Gould has advocated for supervisory flexibility that considers each national bank’s size and business model.[5] FRB Vice Chair Michelle Bowman called for “restoring regulatory tailoring” and “reforming and refocusing supervision.”[6] As part of such efforts, she noted rulemaking activities must be pragmatic, efficient, and effective, “considering the costs and benefits of any proposed change, as well as incentive effects, impacts on markets, and potential unintended consequences.”[7] FDIC Acting Chair Hill has called for inflation-indexing or otherwise scaling thresholds triggering enhanced supervisory or regulatory expectations to ensure the burden on community banks is not excessive.[8]

A third common theme is regulatory modernization and clarity. In her confirmation hearing, FRB Vice Chair for Supervision Michelle Bowman committed to “promoting transparency and accountability” in supervision.[9] Many observers expect greater transparency around capital stress tests and other supervisory processes under Vice Chair Bowman. The call for regulatory modernization and transparency goes hand in hand with a renewed focus on financial risks, including credit, interest rate, operational, and liquidity risks. FDIC Acting Chair Hill has called for “the supervisory process to focus more on core financial risks and less on process,” as well as the establishment of an office of supervisory appeals within the FDIC.[10] Comptroller Gould also called for greater examination focus on material financial risks[11] and allowing banks to engage in “prudent risk-taking.”[12]

Most federal financial institution regulators have also called for greater innovation in financial services. In his acceptance statement, Comptroller Gould called for the OCC to “embrace innovation.”[13] More recently, the Comptroller promised to swiftly implement the GENIUS Act, which grants the OCC authority to supervise registered foreign stablecoin issuers operating in the United States. In a speech to the Bank of International Settlements,[14] Vice Chair Bowman has called for the Federal Reserve to review a wide range of guidance, including Supervision and Regulation Letters and other guidance for issues that may impede innovation, as well as provide a venue for banks and innovators to share information on new products and services. Vice Chair Bowman also called for regulations “to strike the right balance between encouraging growth and innovation and safety and soundness.”[15] FDIC Acting Chair Hill called for a more transparent approach to fintech partnerships, digital assets, and tokenization.[16]

Despite the reduced focus on consumer protection initiatives, some regulators are still actively promoting financial inclusion, albeit with a shift from adversarial enforcement to market-oriented encouragement. The Community Reinvestment Act serves as an incentive for banks to continue investing in the communities they serve, including low- and moderate-income communities. Comptroller Gould stated he would do everything in his power to ensure the OCC maintains the “ability to support the financial aspirations of all of us.”[17] The OCC continues to operate Project REACh, the Roundtable for Economic Access and Change,[18] to develop innovative solutions for financial inclusion and support minority depository institutions. Vice Chair Bowman recently noted that work remains to ensure access to financial services, and that the Federal Reserve will continue to play a significant role in promoting financial inclusion and well-being through research, community engagement, and regulation.[19]

In summary, federal financial institution regulators are refreshing their approaches to supervision, with a focus on tailored, risk-based, and innovation-friendly regulation, as well as reduced complexity. Banks should closely monitor the impact of these rapid changes on their risk management systems.

For more information, reach out to Lynn Woosley at lwoosley@asurity.com.

ABOUT THE AUTHOR
Lynn Woosley is a Managing Director with Asurity Advisors and a member of Case Western Reserve University’s Women in Finance Advisory Board. Lynn has more than 30 years’ of risk management experience in both financial services and regulatory environments. She is an expert in consumer protection, including fair lending, fair servicing, community reinvestment, and UDAAP. Before joining Asurity Advisors, Lynn led the fair banking practice for an advisory firm. She has also held multiple leadership positions, including Senior Vice President and Fair and Responsible Banking Officer, within the Enterprise Risk Management division of a top 10 bank. Prior to joining the private sector, Lynn served as Senior Examiner and Fair Lending Advisory Economist at the Federal Reserve Bank of Atlanta. Reach her at lwoosley@asurity.com.

[1] https://fdic.gov/news/press-releases/2025/statement-acting-chairman-travis-hill

[2] https://www.fincen.gov/news/news-releases/treasury-announces-postponement-and-reopening-investment-adviser-rule

[3] https://www.fincen.gov/news/news-releases/fincen-permits-banks-use-alternative-collection-method-obtaining-tin-information

[4] https://www.occ.gov/news-issuances/news-releases/2025/nr-occ-2025-27.html

[5] https://www.banking.senate.gov/imo/media/doc/gould_testimony_3-27-25.pdf

[6] https://www.federalreserve.gov/newsevents/testimony/bowman20250410a.htm

[7] https://www.federalreserve.gov/newsevents/testimony/bowman20250410a.htm

[8] https://www.fdic.gov/news/press-releases/2025/statement-acting-chairman-travis-hill

[9] https://www.federalreserve.gov/newsevents/testimony/bowman20250410a.htm

[10] https://www.fdic.gov/news/press-releases/2025/statement-acting-chairman-travis-hill

[11]https://www.banking.senate.gov/imo/media/doc/Gould%20Resp%20to%20Warren%20QFRs%203-27-25.pdf

[12] https://www.banking.senate.gov/imo/media/doc/gould_testimony_3-27-25.pdf