View from an Expert

With Trump appointees now settling in, community bankers have become more optimistic that they will experience less stringent exams.  Bank Insights reached out to Peter G. Weinstock, law partner at Hunton Andrews Kurth in Dallas, for his perspective.

“We’re not seeing it at the Fed at all, no difference,” Weinstock said. “Maybe that will come in time,” he added, noting that new Fed Governor Michelle W. Bowman, the former banking commissioner in Kansas, had recently been confirmed to fill a community bank seat. 

“The OCC and FDIC are tending to be less gotcha in exams. There’s more of a willingness to discuss issues before they turn into enforcement actions,” he said. “I never understood the one-bite-of-an-apple rule,” he said, explaining that in the recent past examiners marked down banks for any pitfall without allowing for a give-and-take.

So, what are examiners focusing on? “Liquidity, deposits, cost of funds. Deposit longevity studies. All of these are being discussed,” he said. Banks “heavily into wholesale funding” are also under scrutiny.