/>iOn June 9, Acting Comptroller of the Currency Rodney Hood issued a letter rejecting the Conference of State Bank Supervisors’ (CSBS) request that the OCC rescind its 2011 preemption regulations.
The OCC ‘s letter signals that its preemption framework is foundational to the dual banking system, emphasizing that national banks must be able to operate under a consistent framework across state lines. The agency defended its existing rules as consistent with federal law and Supreme Court precedent, including the standard that preemption applies where state laws “prevent or significantly interfere with” the exercise of national bank powers.
Responding to criticism that the agency’s 2011 regulations conflict with Dodd-Frank or more recent executive orders, Hood asserted that the OCC has already evaluated its rules under these authorities and reaffirmed their validity. He further dismissed arguments that preemption is anti-competitive, stating instead that it enables national product offerings and broader economic growth.
Putting It Into Practice: The OCC’s letter sends a clear message that the agency will continue defending a broad preemption framework for national banks. While other regulators have scaled back their oversight roles (previously discussed here), the OCC is moving in the opposite direction. While banks may find reassurance in the regulatory stability the OCC is signaling, they must still carefully monitor emerging state-level requirements.
