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Standard Summary
Comprehensive overview in 1-2 paragraphs
S. 875, the FIRM Act, eliminates reputational risk from the supervision of depository institutions by prohibiting federal banking agencies from using it as a basis for regulation, examination, or enforcement, and requires agencies to report implementation within 180 days.
Key Points
- 1Prohibits use of reputational risk in supervisory frameworks.
- 2Removes references to reputational risk from guidance, rules, and manuals.
- 3Bans agencies from establishing rules or taking enforcement actions based on reputational risk.
- 4Mandates a 180‑day report to congressional committees on compliance.
- 5Aims to prevent political weaponization of banking supervision.
Impact Areas
Federal banking agencies (FDIC, OCC, NCUA, CFPB)Depository institutions and their customersFinancial regulators and oversight bodiesBusinesses subject to banking supervision
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