February 27, 2018

The U.S. GAO published a report reviewing policies and analyses under the Regulatory Flexibility Act. The report concludes that policies and analyses under the Regulatory Flexibility Act and Retrospective Reviews could be improved.

The Regulatory Flexibility Act requires federal agencies to analyze the impact of their regulations on small entities. GAO found several weaknesses with the analyses of six financial regulators—CFPB, CFTC, FDIC, FED, OCC, and SEC—that could undermine the goal of the Regulatory Flexibility Act and limit transparency and public accountability. For example, some analyses lacked important information, such as data sources, methodologies, and consideration of broad economic impact. Evaluations of potential economic effects and alternative regulatory approaches also were limited. Additionally, regulators generally lacked comprehensive policies and procedures for implementation of the Regulatory Flexibility Act. By not developing such policies and procedures, the ability of regulators to consistently and effectively meet the objectives of Regulatory Flexibility Act may be limited.

This report is based on findings from the GAO reports on implementation of the Regulatory Flexibility Act (published in January 30, 2018) and on regulatory burden on community banks and credit unions (published in February 13, 2018). In these two reports, GAO made 20 recommendations to the financial regulators to improve their policies, procedures, and analysis under the Regulatory Flexibility Act and in retrospective reviews. The regulators generally agreed with the recommendations. Federal financial regulators must comply with various rulemaking and review requirements, including those in the Regulatory Flexibility Act and the Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA). These statutes require analyses relating to regulatory burden, small entities, or both analyses during rulemaking and retrospective reviews. As part of the retrospective reviews, EGRPRA directs FDIC, FED, and OCC to review regulations at least every 10 years and identify areas that are outdated, unnecessary, or unduly burdensome. The Regulatory Flexibility Act requires agencies to review within 10 years of publication those rules assessed as having a significant economic impact on a substantial number of small entities. Agencies are to determine if rules should be continued without change, amended, or rescinded to minimize such impact.


Related Links

Keywords: Americas, US, Banking, Regulatory Flexibility Act, Retrospective Reviews, EGRPRA, Proportionality, GAO

Related Articles
News

FSB to Evaluate Effects of Too-Big-To-Fail Reforms for Systemic Banks

FSB is seeking feedback as part of its evaluation of the effects of the too-big-to-fail reforms for banks.

May 23, 2019 WebPage Regulatory News
News

APRA Releases Minor Changes to Reporting Standards on SA-CCR for Banks

APRA released minor changes to the three reporting standards for the standardized approach for measuring counterparty credit risk exposures (SA-CCR).

May 22, 2019 WebPage Regulatory News
News

APRA on Industry Self-Assessments into Governance and Accountability

APRA released an information paper analyzing the self-assessments performed by 36 of the country’s largest banks, insurers, and superannuation licensees in response to the final report on the Prudential Inquiry into the Commonwealth Bank of Australia (CBA).

May 22, 2019 WebPage Regulatory News
News

PRA Consults on Maintenance of TMTP Under Solvency II

PRA published a consultation paper (CP11/19) that sets out its approach to update supervisory statement (SS6/16) on maintenance of the transitional measure on technical provisions (TMTP) under Solvency II.

May 22, 2019 WebPage Regulatory News
News

APRA Proposes to Amend Guidance on Residential Mortgage Lending

APRA is consulting on revisions to the prudential practice guide APG 223 on residential mortgage lending in Australia.

May 21, 2019 WebPage Regulatory News
News

IASB Proposes Improvements to IFRS 9 and IFRS 16

IASB published the exposure draft ED 2019/2 that proposes amendments to four IFRS standards, including IFRS 9 on Financial Instruments and IFRS 16 on Leases.

May 21, 2019 WebPage Regulatory News
News

Denis Beau of BDF on Supervisory Priorities for Climate-Change Risks

Denis Beau, the First Deputy Governor of BDF, delivered opening remarks at the BCBS-BSCEE-FSI High-level Meeting for Europe on banking supervision.

May 21, 2019 WebPage Regulatory News
News

ISDA CDM to be Deployed for UK Digital Regulatory Reporting Pilot

ISDA announced deployment of the ISDA Common Domain Model (ISDA CDM 2.0) to support the UK FCA, BoE, and participating financial institutions in testing phase two of the Digital Regulatory Reporting pilot for derivatives.

May 21, 2019 WebPage Regulatory News
News

MAS to Consolidate Regulation of Merchant Banks Under Banking Act

MAS published a consultation paper that proposes to consolidate the regulation of merchant banks under the Banking Act and to move merchant banks to a licensing regime under the MAS Act.

May 21, 2019 WebPage Regulatory News
News

ESAs Amend Technical Standards on Mapping of ECAIs Under CRR

ESAs published a second amendment to the implementing technical standards on the mapping of credit assessments of External Credit Assessment Institutions (ECAIs) for credit risk under the Capital Requirements Regulation (CRR).

May 20, 2019 WebPage Regulatory News
RESULTS 1 - 10 OF 3118