[Federal Register Volume 63, Number 88 (Thursday, May 7, 1998)]
[Rules and Regulations]
[Pages 25157-25158]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-12059]


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FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Ch. III


Statement of Policy on the Development and Review of Regulations

AGENCY: Federal Deposit Insurance Corporation (FDIC).

ACTION: Revision of statement of policy.

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SUMMARY: The FDIC is revising its Statement of Policy entitled 
``Development and Review of Regulations'' (Policy). The revisions 
streamline the Policy and focus it more sharply on the basic principles 
that underlie the Board's approach to regulation. The provisions of the 
Policy that established internal procedures or merely restated the law 
have been deleted. The revisions also expand the scope of the Policy to 
include written statements of policy adopted by the FDIC Board of 
Directors and revise its title accordingly.

EFFECTIVE DATE: May 7, 1998.

FOR FURTHER INFORMATION CONTACT:
Steven F. Hanft, Assistant Executive Secretary (202/898-3907); or Nancy 
Schucker Recchia, Counsel (202/898-8885).

SUPPLEMENTARY INFORMATION: The FDIC is revising its Statement of Policy 
entitled ``Development and Review of Regulations.'' The existing Policy 
has stated the Board's commitment to basic principles of sound 
regulation and established internal administrative procedures for FDIC 
staff to follow when developing and reviewing regulations. Pursuant to 
section 303(a) of the Riegle Community Development and Regulatory 
Improvement Act of 1994 (CDRI), the Policy was reviewed to streamline 
it and to remove inconsistencies and outmoded and duplicative 
provisions. As a part of this review, the FDIC has given careful 
consideration to the continuing need for this Policy and how its 
content might be presented to best inform the public with respect to 
the FDIC's development and review of regulations and written statements 
of policy. The revised Policy's reflects the Board's continuing 
commitment to improving the quality of its regulations and policies, to 
minimizing regulatory burdens on the public and the banking industry, 
and generally to ensuring that its regulations and policies achieve 
legislative goals effectively and effectively.
    The revised Policy recognizes that the Board carries out its 
regulatory function through two separate processes of public notice: 
the promulgation of regulations pursuant to the requirements of the 
Administrative Procedure Act, and the issuance of less formal written 
statements of policy. Like regulations, written statements of policy 
may affect the banking industry and the public. Because the Board 
believes it is important to inform all interested parties of its 
approach to the development of written statements of policy, the scope 
of the revised Policy has been augmented to include an explanation of 
the principles by which the FDIC develops and reviews written 
statements of policy, and the title of the Policy has been revised to 
reflect the expanded scope.
    The revisions streamline the Policy and focus it more sharply on 
the following basic principles that underlie the Board's approach to 
regulation:
    <bullet> Burdens imposed on the banking industry should be 
minimized.
    <bullet> Regulations should be clearly and understandably written.
    <bullet> The public should have a meaningful opportunity to 
participate in the rulemaking process.
    <bullet> Common statutory and supervisory mandates should be 
implemented by Federal financial institutions regulator in a uniform 
way.
    <bullet> Regulations and statements of policy should be reviewed 
periodically.
    The revised Policy has been streamlined to remove those provisions 
that established internal procedures or merely restated the applicable 
provisions of law. As part of the CDRI review, the FDIC gave careful 
consideration to the most useful and efficient format for presenting 
all of the information relevant to regulation and written policy 
statement development and review. It was determined to separate these 
fundamental guiding principles from the more technical or procedural 
requirements. The guiding principles which the Board believes are 
relevant to public understanding of its process are contained in the 
revised Policy. The technical and procedural requirements are contained 
in a newly developed handbook on Development and Review of FDIC 
Regulations and Policy Statements. The handbook provides comprehensive 
guidance to FDIC managers and staff involved in developing and 
reviewing FDIC regulations and statements of policy and can be revised 
easily to reflect changes in statutory requirements and in the FDIC's 
organizational arrangements.

Text

    The text of the revised statement of policy follows:

[[Page 25158]]

Development and Review of FDIC Regulations and Policies

Statement of Policy

    Purpose and Scope. The Federal Deposit Insurance Corporation is 
committed to continually improving the quality of its regulations and 
policies, to minimizing regulatory burdens on the public and the 
banking industry, and generally to ensuring that its regulations and 
policies achieve legislative goals effectively and efficiently. The 
purpose of this statement of policy (Policy) is to establish basic 
principles which guide the FDIC's promulgation and review of 
regulations and written statements of policy. The scope of this Policy 
is limited to regulations and written statements of policy issued by 
the Board of Directors of the FDIC.
    Principles For the Development and Review of Regulations and 
Statements of Policy. The following principles guide the FDIC in its 
development of regulations and written policies:
    <bullet> Burdens imposed on the banking industry and the public 
should be minimized. Before issuing a regulation or written statement 
of policy the FDIC gives careful consideration to the need for such an 
issuance. Frequently a regulation is required by statute. 
Alternatively, the FDIC may identify a need for a supervisory tool to 
implement its statutory obligations, or to clarify its policy for the 
benefit of the banking industry or the public. Once the need for a 
regulation or statement of policy is determined, the FDIC seeks to 
minimize to the extent practicable the burdens which such issuance 
imposes on the banking industry and the public. New reporting and 
recordkeeping requirements imposed by a regulation are carefully 
analyzed. The effect of the regulation or statement of policy on 
competition within the industry is considered. Particular attention is 
focused on the impact that a regulation will have on small institutions 
and whether there are alternatives to accomplish the FDIC's goal which 
would minimize any burden on small institutions. Prior to issuance, the 
potential benefits associated with the regulation or statement of 
policy are weighed against the potential costs.
    <bullet> Regulations and policies should be clearly and 
understandably written. The Board seeks to make its regulations and 
statements of policy as clear and as understandable as possible to 
those persons who are affected by them. In developing or reviewing 
existing regulations and statements of policy, the Board considers the 
document's organizational structure as well as the specific language 
used; both are important components to achieving a clear and useful 
statement.
    <bullet> The public should have a meaningful opportunity to 
participate in the rulemaking process. The Board seeks to improve its 
regulations and statement of policy during the development phase. 
Whether a new regulation is being promulgated or an existing one 
revised, the Board gives careful consideration to the implications of 
its actions as public policy. Public participation in the rulemaking 
process is an opportunity for the Board to hear directly from affected 
members of the public with important experience and thoughtful insights 
related to the pertinent issues. A person or organization may petition 
the Board for the issuance, amendment, or repeal of any regulation or 
policy by submitting a written petition to the Executive Secretary of 
the FDIC. The petition should include a complete and concise statement 
of the petitioner's interest in the subject matter and the reasons why 
the petition should be granted.
    All rulemaking is carried out in accordance with the APA, by which 
the Board provides the public with notices of proposed rulemaking and 
opportunities to submit comments on the proposals. The Board will often 
seek public comment on proposed statements of policy as well. All 
comments and proposed alternatives received during the comment period 
are considered prior to the issuance of a final rule or statement of 
policy. The Board takes final action on proposed regulations and 
policies as promptly as circumstances allow. If a significant period of 
time elapses following the publication of a proposed rule or policy 
without final action, the Board will consider withdrawing the proposal 
or re-publishing it for comment. If the Board decides to reconsider a 
proposed regulation or statement of policy that has been withdrawn, it 
will begin the rulemaking or policy development process anew.
    <bullet> Common statutory and supervisory requirements should be 
implemented by the Federal financial institutions regulators in a 
uniform way. The FDIC has many statutory and supervisory requirements 
that are common to the Board of Governors of the Federal Reserve 
System, the Office of the Comptroller of the Currency, the Office of 
Thrift Supervision, and/or the National Credit Union Administration. 
The more uniform the Federal financial institutions regulators can be 
in their regulations, policies and approaches to supervision, the 
easier it will be for the industry and the public to comply with the 
regulators' requirements. The FDIC is a member of the Federal Financial 
Institutions Examination Council (FFIEC) and works with the other 
federal financial institutions regulators through the FFIEC to make 
uniform those regulations and policies that implement common statutory 
or supervisory policies.
    <bullet> Regulations and statements of policy should be reviewed 
periodically. To ensure that the FDIC's regulations and written 
statements of policy are current, effective, efficient and continue to 
meet the principles set forth in this Policy, the FDIC will 
periodically undertake a review of each regulation and statement of 
policy. The Executive Secretary of the FDIC will, consistent with 
applicable laws and in coordination with other financial institutions 
regulators, establish a schedule and procedures for the reviews. 
Factors to be considered in determining whether a regulation or written 
policy should be revised or eliminated include: the continued need for 
the regulation or policy; opportunities to simplify or clarify the 
regulation or policy; the need to eliminate duplicative and 
inconsistent regulations and policies; and the extent to which 
technology, economic conditions, and other factors have changed in the 
area affected by the regulation or policy. The result of this review 
will be a specific decision for each regulation and statement of policy 
to either revise, rescind or retain the issuance in its then-current 
form. The principles of regulation and statement of policy development, 
as articulated at the beginning of this Policy, will apply to the 
periodic reviews as well.

    By order of the Board of Directors.

    Dated at Washington, D.C. this 28th day of April, 1998.

Federal Deposit Insurance Corporation.
Robert E. Feldman,
Executive Secretary.
[FR Doc. 98-12059 Filed 5-6-98; 8:45 am]
BILLING CODE 6714-01-M