On October 27, the OCC issued a notice of proposed rulemaking (NPRM) rescinding Appendix E to 12 CFR 30, which establishes guidelines for recovery planning for large national banks, federal savings associations (FSAs), and insured federal branches of foreign banks. The OCC initially issued the guidelines in Appendix E in September 2016 to require national banks, FSAs, and federal branches of foreign banks with total consolidated assets of $50 billion to adopt recovery plans addressing certain specified risks and procedures for addressing those risks. The guidelines were amended in 2018 to raise the applicable total consolidated assets threshold to $250 billion, and in 2024, the threshold was lowered to $100 billion. The OCC’s NPRM would eliminate the recovery planning standards published in Appendix E entirely.

The NPRM noted the guidelines unnecessarily burdened banks with requirements for copious documentation that the OCC deemed “scenario-dependent or otherwise conjectural” such that it was often “irrelevant or of limited utility when a covered bank face[d] stress.” The agency also stated that existing safety and soundness standards were sufficient to ensure adequate risk management for covered banks, and that it already expected institutions to maintain a formal contingency funding plan that accounted for various stress scenarios, evaluated the reliability of funding during such times, and ensured access to diverse funding sources under adverse conditions. While the OCC clarified that it was not discouraging the development of recovery plans, it noted that it neither intended to review nor enforce such plans, and it did not expect banks that chose to develop such plans to adhere to them unless consistent with the bank’s safe and sound operations under the specific circumstances.

Finally, the OCC requested input on the specific question of whether it should formally incorporate the contingency funding plan expectations outlined in the addendum to the Interagency Policy Statement on Funding and Liquidity Risk Management. If commenters thought it should do so, the agency also asked whether these requirements should apply to all OCC-supervised institutions or only to a specific subset. The OCC also sought input generally on any other aspect of the NPRM. Comments on the proposed rescission will be due 30 days following publication in the Federal Register.