At the September 2025 meeting of the Financial Stability Oversight Council, FDIC Acting Chairman Travis Hill laid out an ambitious set of reforms designed to reshape the agency’s approach to supervision, capital requirements, digital assets, and more. Hill emphasized that the FDIC’s goal is to unleash the banking system to drive growth and access to capital while maintaining financial stability.
Supervision Reforms
The FDIC is moving away from a process-heavy model and focusing more on core financial risks. Proposed changes underway include:
- Interagency rulemaking to clarify key terms and provide more consistent guardrails in supervision;
- Reforming the CAMELS rating system to better align with financial risk;
- Updating the supervisory appeals process;
- Adjusting the continuous exam program by raising the threshold from $10 billion to $30 billion in assets;
- Extending the timeline for consumer compliance exams for smaller banks;
- Streamlining aspects of the Bank Secrecy Act and IT examinations;
- Revising enforcement policy to allow orders to be lifted when a bank reaches substantial compliance;
- Ending the use of disparate impact in fair lending reviews; and
- Reevaluating the complex bank consumer compliance program.
Capital Rules
The FDIC is working with the OCC and the Federal Reserve to update capital requirements. This proposed reform includes proposals to modify the enhanced supplementary leverage ratio, plans to modernize risk-based capital standards, and consideration of adjustments to the community bank leverage ratio.
Digital Assets
Acting Chairman Hill outlined a significant shift from the prior administration. The FDIC rescinded prior notification requirements for crypto activities, clarified that banks may participate in permissible digital asset activities, released hundreds of pages of supervisory correspondence for transparency, and began work to implement the GENIUS Act and recommendations from the President’s Working Group.
Bank Resolution Process
Drawing lessons from the 2023 failures of Silicon Valley Bank, Signature Bank, and First Republic Bank, the FDIC has revised resolution planning requirements for large regional banks, improved its bidding process for failed institutions, updated guidance on recordkeeping, and is reviewing other aspects of its resolution and receivership functions.
Ending Debanking
Responding to concerns about politically or socially motivated account closures, the FDIC is developing a rule to prohibit examiners from criticizing banks for reputational risk or pressuring them to close accounts based on political, cultural, or religious views. The agency is also reviewing supervised banks for signs of unlawful debanking in line with the President’s recent executive order, covered by Butler Snow here.
Other Priorities
The FDIC has proposed raising and indexing dozens of regulatory thresholds, rescinded its 2024 bank merger policy statement, and is working on a stronger merger review framework. The agency is exploring ways to encourage more de novo bank activity, proposing faster approval timelines for new branches, and has rolled back the 2023 Community Reinvestment Act rule.
Takeaways
Together, these actions mark one of the most comprehensive reform efforts in recent FDIC history. By shifting the focus toward financial risks, updating capital rules, embracing transparency in digital assets, and addressing concerns about fair access to banking, the FDIC is positioning itself to balance stability with economic growth.
