The Office of the Comptroller of the Currency (“OCC”) recently sought comment on a proposed rule designed to increase the transparency of the standards applicable to the OCC’s review of business combinations (i.e., bank mergers, consolidations or the assumption of deposits) involving national banks and federal savings associations (the “NPRM”). At a high level, the NPRM would amend two provisions of the OCC’s rules for business combinations set forth in 12 CFR 5.33 and add as an appendix to 12 CFR 5, subpart C, a policy statement summarizing the principles the OCC considers when reviewing bank merger transactions under the Bank Merger Act (“BMA”), including the OCC’s consideration of the following factors: (i) financial stability, (ii) financial and managerial resources and future prospects and (iii) convenience and needs (the “Policy Statement”). The amendments would apply to all national banks, federal savings associations and federal branches and agencies of foreign banks, while the Policy Statement would be applicable to insured national banks, federal savings associations and federal branches of foreign banks. A brief summary of the NPRM is provided below.
- Amendments: Removal of Provisions Related to Expedited Review. The NPRM would remove the expedited review procedures currently set forth in 12 CFR 5.33(i), which, as currently written, provide that a filing qualifying as a “business reorganization” or “streamlined application” is deemed approved as of the 45th day after the OCC receives such filing, or the 15th day after the close of the comment period, whichever is later, unless the OCC notifies the applicant otherwise before such deadline. In addition, the NPRM does away with the OCC’s streamlined business combination application, currently allowed for under 12 CFR 5.33(j), and requires the filing of the Interagency Bank Merger Act Application for all applicants. The OCC believes the NPRM’s removal of these provisions reflects the OCC’s opinion that business combinations subject to filing requirements are inherently significant transactions deserving of substantive agency review and should not be passively approved merely as a result of the passage of time.
- Policy Statement: General Principles. The Policy Statement states that the following are general principles that would steer its business combination review process:
|