in smaller or rural communities and zombie banks that continue to exist but have no competitive viability or exit strategy. m & a reform is currently a popular topic on the banking agency regulatory agenda with the process and standards regulators employ to review and approve transactions under intense scrutiny. recently some of the federal banking regulators have proposed or described new m & a policy approaches, with the department of justice currently reviewing how it enforces section 7 of the clayton act. 7 as regulators revisit the evaluation standards for bank m & a transactions under the statutory framework, we should consider whether the regulatory review process is fair, transparent, and consistent with applicable statutes. this should begin with an important threshold question — what are the identified shortcomings with the current process or standards, and are the proposed reforms targeted and effective to address these shortcomings? one concern that has been raised about the m & a regulatory approval process seems largely based on the misconception that a lack of application denials implies that jonathan kanter, “ merger enforcement sixty years after philadelphia national bank ” ( keynote address at the brookings institution ’ s center on regulation and markets event, promoting competition in banking, washington, dc, june 20 2023 ), https : / / www. justice. gov / opa / speech / assistant - attorney - general - jonathankanter - delivers - keynote - address - brookings - institution ; office of the comptroller of the currency, “ business combinations under the bank merger act : notice of proposed rulemaking, ” occ bulletin 2024 - 4, january 29, 2024, https : / / occ. gov / news - issuances / bulletins / 2024 / bulletin - 2024 - 4. html ; federal deposit insurance corporation, “ fdic seeks public comment on proposed revisions to its statement of policy on bank merger transactions, ” news release, march 21, 2024, https : / / www. fdic. gov / news / pressreleases / 2024 / pr24017. html. - 8standards are simply not rigorous enough, that the regulatory approval process has become a rubber stamp. this view ignores the reality of the filing process. these transactions require significant upfront and ongoing investment and commitment of resources. at the outset, this includes finding an appropriate acquisition target, conducting due diligence, and negotiating the terms of the transaction. once a target is identified, the banks must prepare appropriate regulatory filings, engage with regulators

corporation, the federal reserve, and the office of the comptroller of the currency recently passed an interim final rule to extend the applicability date of certain provisions in the recent amendments to the community reinvestment act regulations. the need for these delays to important and controversial elements of the final rule illustrates the rushed, overly complex, and unwieldy nature of the community reinvestment act rulemaking. see dissenting statement of governor michelle w. bowman, “ statement on the interim final rule and final rule amending the community reinvestment act regulations ” march 21, 2024, https : / / www. federalreserve. gov / newsevents / pressreleases / bcreg20240321a1. htm. michelle w. bowman, “ the path forward for bank capital reform, ” ( speech at protect main street sponsored by the u. s. chamber of commerce, washington, dc, january 17, 2024 ), https : / / www. federalreserve. gov / newsevents / speech / files / bowman20240117a. pdf ; “ reflections on the economy and bank regulation ” ( speech at the florida bankers association leadership luncheon events, miami, fl, february 27, 2024 ), https : / / www. federalreserve. gov / newsevents / speech / files / bowman20240227a. pdf ; “ reflections on the economy and bank regulation ” ( speech at the new jersey bankers association annual economic leadership forum, somerset, nj, march 7, 2024 ), https : / / www. federalreserve. gov / newsevents / speech / files / bowman20240307a. pdf ; “ tailoring, fidelity to the rule of law, and unintended consequences, ” ( speech at the harvard law school faculty club, cambridge, ma, march 5, 2024 ), https : / / www. federalreserve. gov / newsevents / speech / files / bowman20240305a. pdf. - 4embedded in these regulatory reforms, even if only in the form of a proposal, have already begun shaping the u. s. banking system. revisions to the regulatory and supervisory framework reflect policy decisions about not only the risk tolerance of regulators, but also the role of banks in the banking system and the broader u. s. economy. these policy decisions create incentives