Congress Overturns New Bank Merger Review Rule: What It Means for Oversight and Your Local Bank

This joint resolution effectively hits the brakes on a new rule from the Office of the Comptroller of the Currency (OCC), a key regulator within the Treasury Department. The rule, officially known as "Business Combinations Under the Bank Merger Act" (published as 89 Fed. Reg. 78207), was set to change how the OCC scrutinizes bank merger applications. By passing this resolution, Congress is using its power under the Congressional Review Act (found in chapter 8 of title 5, United States Code) to declare that specific OCC rule "without legal power," essentially wiping it off the books before it could fully reshape the merger review landscape.

The Nixed Rule: What Was the OCC Trying to Do?

The OCC's rule (89 Fed. Reg. 78207) aimed to update the playbook for how it reviews proposed bank mergers. A significant change involved removing certain "expedited review procedures." Think of this like taking away the express lane for some merger applications, meaning more of them would go through the standard, potentially more detailed, review process. The goal appeared to be a more consistent and possibly more thorough look at these combinations, ensuring the OCC had a clear policy statement on the principles guiding these critical decisions. With this congressional disapproval, that specific update and the removal of those faster pathways won't be implemented by the OCC.

Merger Scrutiny: Back to the Old Drawing Board?

So, what happens now that Congress has stepped in? Essentially, the OCC's intended changes to its merger review process, particularly the elimination of some fast-track options, are nullified. This means the procedures and standards for reviewing bank mergers will likely revert to what they were before this specific rule was finalized, or at least won't include these new OCC-driven modifications. For banks looking to merge, this could mean a continued path for quicker approvals in some cases. For everyday people, this action might mean that potential bank mergers in their communities won't face the specific new layers of scrutiny the OCC rule intended to introduce. This could impact things like local bank competition, the availability of branches, or the terms of your accounts if a merger changes your bank.

The Congressional Override: How Lawmakers Can Undo Agency Rules

This move by Congress is made possible by a law called the Congressional Review Act (CRA), which is detailed in chapter 8 of title 5 of the U.S. Code. The CRA gives Congress a window of opportunity to review and overturn rules issued by federal agencies like the OCC. If a joint resolution of disapproval like this one is passed, the agency rule it targets is considered to have no legal force or effect. In this case, it means Congress has directly intervened to prevent the OCC's specific new framework for bank merger reviews, including its plan to remove certain expedited processes, from taking hold. This highlights a significant check Congress has on the regulatory actions of the executive branch.