[Federal Register Volume 91, Number 40 (Monday, March 2, 2026)]
[Rules and Regulations]
[Pages 9977-9982]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2026-04088]
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DEPARTMENT OF THE TREASURY
Office of the Comptroller of the Currency
12 CFR Part 5
[Docket ID OCC-2025-0768]
RIN 1557-AF47
National Bank Chartering
AGENCY: Office of the Comptroller of the Currency, Treasury.
ACTION: Final rule.
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SUMMARY: The Office of the Comptroller of the Currency (OCC) is
amending its rule related to chartering of national banks to clarify
the longstanding authority of national banks limited to the operations
of trust companies and activities related thereto to engage in non-
fiduciary activities in addition to their fiduciary activities.
DATES: The final rule is effective on April 1, 2026.
FOR FURTHER INFORMATION CONTACT: Christopher Crawford, Acting Assistant
Director; Marjorie Dieter, Counsel, Chief Counsel's Office, 202-649-
5490, Office of the Comptroller of the Currency, 400 7th Street SW,
Washington, DC 20219. If you are deaf, hard of hearing, or have a
speech disability, please dial 7-1-1 to access telecommunications relay
services.
SUPPLEMENTARY INFORMATION:
I. Background
The OCC charters national banks under the authority of the National
Bank Act, 12 U.S.C. 1 et seq. The National Bank Act ``constitut[es] by
itself a complete system for the establishment and government of
national banks.'' \1\ Congress's grant of authority to the OCC with
regard to the establishment of national banks under the National Bank
Act culminates in the OCC's issuance of formal certificates authorizing
national banks to conduct business, which are generally referred as
charters.\2\ In 1978, Congress amended the National Bank Act to
expressly provide: ``A National Bank Association, to which the
Comptroller of the Currency has heretofore issued or hereafter issues
such [charter] certificate, is not illegally constituted solely because
its operations are or have been required by the Comptroller of the
Currency to be limited to those of a trust company and activities
related thereto.'' \3\
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\1\ Cook Cnty. Nat'l Bank v. United States, 107 U.S. 445, 448
(1883).
\2\ See 12 U.S.C. 27.
\3\ Financial Institutions Regulatory and Interest Rate Control
Act of 1978, sec. 1504, Public Law 95-630, 92 Stat. 3641, 3713
(1978).
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The OCC has referenced this express endorsement of its authority
for nearly fifty years when chartering national banks whose operations
are limited to those of a trust company and activities related thereto,
which are commonly referred to as ``national trust banks.'' The OCC
currently supervises approximately 60 national trust banks. The
majority of the national trust banks are uninsured, but a few hold
deposits and are insured by the Federal Deposit Insurance Corporation.
Section 5.20 provides for the general procedures for filing an
application, the OCC's review, procedures for organizing the new bank,
and other requirements. Since 1996, Sec. 5.20(e)(1)(i) \4\ has
addressed certain statutory requirements for the OCC's chartering of a
national bank. The regulation states that the OCC charters national
banks under the authority of the National Bank Act and includes the
requirement that a
[[Page 9978]]
national bank's name must include the word ``national.'' \5\
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\4\ References to Sec. 5.20(e)(1)(i) are to the current
location of the provision. Before 2015, the relevant text was at
Sec. 5.20(e)(1).
\5\ See 12 U.S.C. 22, 30(a).
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In 2003, the OCC proposed amendments to Sec. 5.20(e)(1)(i) ``to
clarify that a limited purpose national bank may exist with respect to
activities other than fiduciary activities, provided the activities in
question are within the business of banking.'' \6\ This proposal
included only the sentence: ``The bank may be a special purpose bank
that limits its activities to fiduciary activities or to any other
activities within the business of banking.'' \7\
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\6\ 68 FR 6363, 6370-71 (Feb. 7, 2003).
\7\ 68 FR 6373.
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Commenters on the 2003 proposal were concerned that the reference
to the business of banking in the proposed rule was ``too broad.'' \8\
In response to this concern, the 2003 final rule added another sentence
to Sec. 5.20(e)(1)(i): ``A special purpose bank that conducts
activities other than fiduciary activities must conduct at least one of
the following three core banking functions: Receiving deposits; paying
checks; or lending money.'' \9\ The OCC did so ``to provide further
clarification of the scope of activities permissible for a limited
purpose national bank, and . . . amended this provision to require
limited purpose national banks to conduct at least one of the following
core banking functions: (1) receiving deposits; (2) paying checks; or
(3) lending money. These functions are based on 12 U.S.C. 36, which
identifies activities that cause a facility to be considered a bank
branch.'' \10\ The operations of a national trust bank typically
include performing fiduciary activities under the authority of 12
U.S.C. 92a,\11\ a separate source of authority from those activities
within the business of banking under 12 U.S.C. 24(Seventh).\12\
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\8\ 68 FR 70122, 70126 (Dec. 17, 2003).
\9\ 68 FR 70129.
\10\ 68 FR 70126.
\11\ See OCC Interpretive Letter No. 1170 (July 22, 2020); OCC
Interpretive Letter No. 1078 (Apr. 19, 2007); OCC Interpretive
Letter No. 1176 (Jan. 11, 2021).
\12\ Compare 12 U.S.C. 24 (Seventh) with 12 U.S.C. 92a.
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The OCC's addition of language to Sec. 5.20(e)(1) was to address
special purpose banks engaging in only activities within the business
of banking. As noted in the preamble to the 2003 final rule, ``The
purpose of this proposed change was to clarify that a limited purpose
national bank may exist with respect to activities other than fiduciary
activities, provided the activities in question are part of the
business of banking.'' \13\ In other words, the language in amended
Sec. 5.20(e)(1)(i) referencing a ``bank that conducts activities other
than fiduciary activities'' was intended to clarify that the provision
did not address national trust banks; the provision addressed special
purpose banks that would engage in activities other than those of a
trust company. The language was not intended, and has never been
interpreted by the OCC, to circumscribe national trust bank activities,
i.e., to prohibit a national trust bank from engaging in non-fiduciary
activities. The authority to charter national trust banks under 12
U.S.C. 27(a) is clear on its face.
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\13\ 68 FR 70126.
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Nonetheless, the OCC believes that the language added in 2003 has
the potential to raise confusion about the scope of the OCC's
chartering authority under 12 U.S.C. 27(a) and the activities of
national trust banks. Because the language does not explicitly exclude
all national trust bank activities (just fiduciary activities), it
could be mistakenly read to also impose limits on the activities of
national trust banks that are different than those articulated in the
last sentence of section 27(a). Such a reading would conflict with the
intent of the regulatory text added in 2003, which did not intend to
circumscribe the OCC's authority to charter national trust banks.
Moreover, reading the regulation to apply to national trust bank
charters would run contrary to the OCC's long-held interpretation and
historical practice. The OCC has never interpreted Sec. 5.20(e)(1) in
a way that restricts national trust banks. Both before and after the
2003 final rule, the OCC has chartered national trust banks that engage
in activities that are not fiduciary. For example, the OCC considers
custody and safekeeping activities to be generally non-fiduciary and
authorized for national banks as part of the business of banking under
12 U.S.C. 24(Seventh).\14\ National trust banks also frequently conduct
non-fiduciary custody activities and currently hold nearly $2 trillion
in assets in custody or safekeeping accounts.\15\
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\14\ See 84 FR 17969 (Apr. 29, 2019); OCC Interpretive Letter
No. 1078 at 4 (May 2007). National banks may also provide custody
services in a fiduciary capacity when authorized in accordance with
12 U.S.C. 92a.
\15\ This figure is derived from ``custody and safekeeping
accounts'' information reported on Schedule RC-T of the Consolidated
Reports of Condition and Income.
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To address these concerns, on January 12, 2026, the OCC published
in the Federal Register a notice of proposed rulemaking to amend 12 CFR
5.20 to more closely align with its statutory authorization to charter
national banks limited to the operations of a trust company and
activities related thereto.\16\ Specifically, the OCC proposed to amend
Sec. 5.20(e)(1)(i) to replace the term ``fiduciary activities'' with
``the operations of a trust company and activities related thereto,''
as stated in 12 U.S.C. 27(a). The OCC also proposed to make a
conforming amendment to 12 CFR 5.20(l) by replacing the term
``fiduciary activities'' with ``the operations of a trust company and
activities related thereto'' to align paragraph (l) with paragraph (e)
and reflect consistent language with 12 U.S.C. 27(a). As explained in
greater detail below, following review of the comments received on the
proposal, the OCC is finalizing these proposed amendments without
change.
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\16\ 91 FR 1098. The OCC published a correction on January 14,
2026, to correct a docket number typographical error, fix a footnote
citation, and clarify agency references. 91 FR 1464.
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II. Discussion of Comments Received
The OCC received in total 19 comments on the notice of proposed
rulemaking. The OCC received three requests to extend the public
comment period, asserting that additional time was needed for analysis
and to solicit the commenters' members' feedback. The Administrative
Conference of the United States has recognized that 30 days is
generally an appropriate period for rulemakings, such as this one, that
are not significant regulatory actions under Executive Order 12866.\17\
Further, as discussed in the proposed rule's Supplementary Information,
the 2003 rulemaking setting forth the limited purpose language
currently in Sec. 5.20(e)(1)(i) was not intended to provide any
constraints on the powers of national trust banks. The proposal was
merely to change the regulatory language to mimic the statutory
language in 12 U.S.C. 27(a), which has been in place for nearly fifty
years. Additionally, the OCC published its understanding of the scope
of section 27(a) five years ago in Interpretive Letter 1176. Because
the proposed change to the regulation is straightforward, the OCC's
chartering authority under section 27(a) has not recently changed, and
the proven ability of stakeholders to comment on the nature of the
trust bank authority, the OCC believes that 30 days
[[Page 9979]]
was appropriate for the public comment period.\18\
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\17\ See Administrative Conference of the United States,
Administrative Conference Recommendation 2011-2: Rulemaking Comments
at 3 (June 16, 2011). See infra for analysis under Executive Order
12866.
\18\ Further, the OCC has continued to review and accept
comments filed after the formal close of the public comment period
and has addressed all comments received prior to the submission of
the final rule to the Federal Register in this Supplementary
Information.
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Five commenters expressed support for the proposed rule. One
supportive commenter also requested that the OCC further indicate
either through an amendment to Sec. 5.20 or in an accompanying release
that a national trust bank need not conduct any activities in a
fiduciary capacity. As discussed in greater detail below, the OCC does
not believe it is appropriate to amend the regulation further at this
time with respect to the required scope of fiduciary activities for a
national trust bank. The OCC will review all charter applications on
their own merits and issue decisions in accordance with law, including
the provisions of section 27(a).
One commenter, while not clearly voicing support for or opposition
to the proposal, requested that the OCC prohibit national trust banks,
other than those that are a subsidiary of a bank or bank holding
company, from including the word ``bank'' in their names. The commenter
noted that this would align with 12 CFR 5.20(f)(2)(i)(F), which
prohibits banks from having a ``title that misrepresents the nature of
the institution or the services it offers.'' The OCC declines to adopt
this suggestion. As section 27(a) makes clear, a national trust bank is
a national bank, albeit one limited to the ``operations . . . of a
trust company and activities related thereto.'' \19\ Although the
precise language varies throughout the National Bank Act and other
provisions of Federal law, statutes referencing national banks all
clearly contain the word ``bank'' or ``banking.'' \20\ Accordingly, a
national trust bank is legally a ``bank'' that is permitted to engage
in certain activities within the business of banking.
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\19\ See 12 U.S.C. 27(a) (last sentence) (specifically referring
to ``National Bank Association'').
\20\ See, e.g., 12 U.S.C. 24 (``national bank'' and ``national
banking association''), 221 (``national bank'' and ``national
banking association'' expressly interchangeable), 1813 (``national
bank'' and ``national banking association'').
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Multiple commenters asserted that the OCC is misconstruing the
statutory authorization of section 27(a) and that the reference to
``operations . . . of a trust company'' must exclusively mean fiduciary
powers. In support, commenters cite the 1979 opinion of the U.S. Court
of Appeals for the Third Circuit in National State Bank of Elizabeth v.
Smith.\21\ The Third Circuit's decision was in response to litigation
over the Comptroller's issuance of a limited purpose national trust
bank charter. The court found that a charter limited by the Comptroller
to ``the general business of a commercial bank trust department and to
engage in such activities as are necessary, incident or related to such
business'' was permissible under section 27(a).\22\ The Third Circuit
was not, however, required to analyze the scope of the authorization.
Thus, the commenters' references are to dicta in the opinion. Moreover,
the court was inconsistent in referring to the operations of a limited
purpose trust bank authorized under section 27(a); at one point the
opinion references ``the trust or fiduciary operations of'' a bank--
i.e., distinguishing the two concepts. At another, the court
specifically focused on the fiduciary powers authorized under 12 U.S.C.
92a.\23\
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\21\ 591 F.2d 223 (3d Cir. 1979).
\22\ Id. at 231-32.
\23\ Compare id. at 231 (``It seems clear, therefore, that
pursuant to this statutory mandate, the Comptroller's action
limiting the business of City Trust to the operations of a
commercial bank trust department must now be held to be valid if the
statutory phrase ``trust company'' may be read as limited in meaning
to the trust or fiduciary operations of such a company.'' (emphasis
added)) with id. (``In other words, it was the fiduciary operations
carried on in the trust department of such a company or of a
commercial bank to which reference must have been intended.).
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The Third Circuit in National State Bank of Elizabeth is not alone
in distinguishing between trust and fiduciary operations. In section
27(a), Congress provided for a national bank limited to ``operations .
. . of a trust company and activities related thereto.'' By contrast,
in 12 U.S.C. 92a, Congress specifically provided for the exercise of
``fiduciary powers'' by national banks.\24\ If Congress had intended to
use ``fiduciary'' in section 27(a), it would have done so. Further, in
other statutes, Congress has expressly distinguished between trust and
fiduciary operations. For example, in an exception from the definition
of the term ``bank'' in the Bank Holding Company Act, Congress included
certain ``institution[s] that function[ ] solely in a trust or
fiduciary capacity.'' \25\ As Congress is presumed to avoid surplusage,
and every word of statute should be given meaning, ``trust'' and
``fiduciary'' must mean different things in the federal banking
statutes.\26\ Accordingly, the OCC is aligning the description of the
authorization for national trust banks in Sec. 5.20(e)(1)(i) with the
statutory authorization in section 27(a), namely referring to trust
operations.\27\
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\24\ The OCC recognizes that the heading of section 92a is
``Trust Powers.'' However, that term is not used within the text of
section 92a itself. Further, although potentially indicative of
meaning, headings of a section are not controlling. See Bhd. of R.R.
Trainmen v. Balt. & Ohio R.R., 331 U.S. 519, 529 (1947) (``For
interpretative purposes, [section headings] are of use only when
they shed light on some ambiguous word or phrase. They are but tools
available for the resolution of a doubt. But they cannot undo or
limit that which the text makes plain.'').
\25\ 12 U.S.C. 1841(c)(2)(D); see also 12 U.S.C. 1971 (defining
``trust service'' for purposes of tying arrangements as ``any
service customarily performed by a bank trust department'').
\26\ See Moskal v. United States, 498 U.S. 103, 109 (1990)
(citations omitted) (discussing ``established principle that a court
should `give effect, if possible, to every clause and word of a
statute' '').
\27\ Even were the commenters correct that the reference in
section 27(a) to ``trust company'' was intended to convey a concept
fully congruent with ``fiduciary powers'' set forth in section 92a,
it is unclear how that legal conclusion would militate against
amending the OCC's regulatory text to incorporate the statutory
standard in section 27(a). That is, amending the OCC's regulation to
adhere to the statutory standard serves to adopt the statutory
standard, whatever the courts determine it to be.
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Relatedly, some commenters appear to misunderstand the scope of the
proposal. Contrary to some commenters' assertions, the OCC has not
proposed a new limited purpose national bank charter untethered from
the national trust bank authorization in section 27(a). Further,
section 27(a) does not provide a separate source of authority for
fiduciary activities or other trust operations. As discussed above with
respect to National State Bank of Elizabeth, the provisions of sections
27(a) and 92a are complementary. Section 27(a) relates to the OCC's
chartering authority and sets forth provisions related to the
organization of a national bank and the OCC's authorization for it to
conduct business. A national trust bank is simply a national bank with
articles of association that limit its activities to the operations of
a trust company and activities related thereto. Any national bank,
however, must rely on other statutes for its authority to conduct
activities. Section 92a provides the powers authority for national
banks, including national trust banks, to engage in fiduciary
activities.\28\ Other activities are generally authorized by 12 U.S.C.
24. Regardless of the scope of activities permissible for a national
trust bank, any non-fiduciary activity must be authorized by separate
statutory authority, such as section 24(Seventh)'s
[[Page 9980]]
authorization for national banks to engage in the business of banking.
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\28\ The predecessor of section 92a was enacted to provide
national banks with parity to state-chartered entities with respect
to fiduciary activities, as these activities were not authorized for
national banks before 1913. See H.R. Rep. No. 65-479, at 2-3 (1918).
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The question of whether a limited purpose national bank chartered
under section 27(a) must conduct fiduciary activities or whether there
is any required quantum of fiduciary activities is therefore outside of
the scope of this rulemaking. The purpose of the final rule is merely
to align the OCC's regulations with the statutory authorization in
section 27(a) to avoid any implication that national trust banks may
not conduct any activities within the business of banking. These
activities may be part of trust company operations, such as custody, or
activities related thereto. The OCC will determine the source of
authority for any proposed activities on a case-by-case basis as part
of its ordinary review of licensing applications regarding national
trust banks. To the extent there is any dispute by a party with
standing over whether a particular national bank charter is authorized
by the National Bank Act, it is the ``[c]ourts [that] must exercise
their independent judgment in deciding whether [the OCC] has acted
within its statutory authority, as the APA requires.'' \29\
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\29\ Loper Bright Enters. v. Raimondo, 603 U.S. 369, 412 (2024).
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One commenter asserted that the OCC would be acting in an arbitrary
and capricious manner, and thus in violation of the Administrative
Procedure Act (APA),\30\ if it does not specify what constitutes non-
fiduciary activities a national trust bank may conduct and the extent
of required fiduciary activities. As explained above, national trust
banks have long been authorized to engage in certain non-fiduciary
activities under 12 U.S.C. 24(Seventh) such as non-fiduciary custody.
The APA requires that the OCC engage in ``reasoned decisionmaking'' and
that the action ``be within the scope of its lawful authority.'' \31\
The OCC's process must also be ``logical and rational . . . rest[ing]
on a consideration of the relevant factors.'' \32\
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\30\ See 5 U.S.C. 706(2)(A).
\31\ Michigan v. EPA, 576 U.S. 743, 750 (2015) (citations
modified).
\32\ Id.
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The OCC is authorized by 12 U.S.C. 93a to ``prescribe rules and
regulations to carry out the responsibilities of the office.'' Section
5.20(e)(1)(i) sets forth the statutory authorization and requirements
for the OCC to charter a national bank under the National Bank Act. As
discussed above, current Sec. 5.20(e)(1)(i) is unclear with respect to
the statutory authorization in 12 U.S.C. 27(a). Thus, the OCC is
revising its regulation to align more clearly with its statutory
authorization to charter national trust banks. The proposed revisions
did not seek to define the scope of fiduciary, non-fiduciary or other
activities under the National Bank Act. Thus, the commenter's request
is beyond the scope of the rulemaking. Rather, in faithfully following
the Congress's statutory action in enacting 12 U.S.C. 27(a) and issuing
the final rule after notice and considering comments, the OCC has
followed the requirements of the APA.\33\ The OCC will make appropriate
determinations in the course of reviewing licensing applications
whether, based on the information provided, the proposed bank may be
chartered in accordance with the OCC's statutory authority.
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\33\ See Vt. Yankee Nuclear Power Corp. v. Nat. Res. Def.
Council, 435 U.S. 519, 523-25 (1978).
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Likewise, one commenter requested that the OCC provide the full
scope of the extent of ``operations of a trust company,'' and two
commenters requested that the OCC define or provide more guidance as to
the scope of ``related thereto.'' As described above, the OCC will
review proposed activities in the context of applications and determine
whether they are within the operations of a trust company, related
thereto, or neither.\34\
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\34\ The OCC also notes that charter applications are subject to
public notice and comment under 12 CFR 5.8 and 5.10. In its recent
decisions conditionally approving national trust bank charters, the
OCC has fulsomely and publicly addressed the comments received. See
decisions cited in OCC News Release 2025-125, ``OCC Announces
Conditional Approvals for Five National Trust Bank Charter
Applications'' (Dec. 12, 2025).
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Finally, commenters made various requests and raised various policy
concerns with respect to the OCC's chartering of national trust banks,
such as requesting clear regulatory, supervisory, and resolution
frameworks, claiming that the OCC's chartering is deviating from the
OCC's core mission, asserting that the OCC should require a public
interest framework, and requesting a moratorium on national trust bank
applications. The comments are beyond the scope of the rulemaking, and
OCC is not making any changes to the final rule with respect to these
items. Rather, the OCC will continue to consider these items, as
relevant, as part of its ongoing supervision of national trust banks
and its review of applications, which will continue in the ordinary
course. As discussed above, the proposed and final rule focus solely on
the legal authorization for chartering a national bank limited to the
operations of a trust company and activities related thereto.
III. Description of the Final Rule
As discussed above, the OCC is amending Sec. 5.20(e)(1)(i) as
proposed to replace the term ``fiduciary activities'' with ``the
operations of a trust company and activities related thereto,'' as
stated in 12 U.S.C. 27(a). The OCC believes that these amendments will
eliminate potential confusion as to the intent, and the OCC's
interpretation, of the existing regulation. The OCC also believes that
these revisions will reinforce the OCC's reliance on the statutory
terms of its chartering authorities.
The OCC is also making a conforming amendment to 12 CFR 5.20(l) by
replacing the term ``fiduciary activities'' with ``the operations of a
trust company and activities related thereto'' to align paragraph (l)
with paragraph (e) and reflect consistent language with 12 U.S.C.
27(a).\35\
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\35\ Paragraph (l), which also applies to special purpose
Federal savings associations, was originally added in 1996 as part
of the OCC's reorganization of 12 CFR part 5. See 61 FR 60342, 60346
(Nov. 27, 1996). In adding this paragraph, the OCC did not explain
why it used the term ``fiduciary activities'' rather than
referencing ``trust powers'' or ``trust business'' as used in the
former 12 CFR 5.22. See 12 CFR 5.22 (1995). Further, the reference
to special purpose banks in paragraph (l) is illustrative and not
restrictive.
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To be clear, through the above noted revisions in 12 CFR 5.20, the
OCC intends to neither expand nor contract the OCC's authority to
charter a national bank. As discussed above, the National Bank Act
``constitute[es] by itself a complete system for the establishment and
government of national banks'' \36\ and is ``the source of the
Comptroller's powers and duties in the granting of a national bank
charter.'' \37\ Revising a potentially unclear provision of the OCC's
regulations that purports to interpret its statutory authority will not
deprive the public of information regarding the OCC's chartering and
supervision authorities. As it always has, the OCC will evaluate all
applications to charter a national bank within the confines of and
consistent with the authority that Congress has granted to it under the
National Bank Act.
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\36\ Cook Cnty. Nat'l Bank, 107 U.S. at 448.
\37\ Webster Groves Tr. Co. v. Saxon, 370 F.2d 381, 384 (8th
Cir. 1966).
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IV. Regulatory Analyses
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 \38\ (PRA) states that no
agency may conduct or sponsor, nor is the respondent required to
respond to, an information collection unless it displays a currently
valid Office of Management
[[Page 9981]]
and Budget (OMB) control number. The OCC has reviewed this final rule
and determined that it does not create any information collection or
revise any existing collection of information. Accordingly, no PRA
submissions to OMB will be made with respect to this final rule.
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\38\ 44 U.S.C. 3501-3521.
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Regulatory Flexibility Act
In general, the Regulatory Flexibility Act (RFA) \39\ requires an
agency, in connection with a final rule, to prepare a final Regulatory
Flexibility Analysis describing the impact of the rule on small
entities (defined by the U.S. Small Business Administration for
purposes of the RFA to include commercial banks and savings
institutions with total assets of $850 million or less and trust
companies with total assets of $47 million or less). However, under
section 605(b) of the RFA, this analysis is not required if an agency
certifies that the final rule would not have a significant economic
impact on a substantial number of small entities and publishes its
certification and a short explanatory statement in the Federal Register
along with its final rule.
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\39\ 5 U.S.C. 601 et seq.
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The OCC currently supervises 997 institutions (commercial banks,
trust companies, Federal savings associations, and branches or agencies
of foreign banks),\40\ of which approximately 609 are small entities
under the RFA.\41\
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\40\ Based on data accessed using the OCC's Financial
Institutions Data Retrieval System on February 18, 2026.
\41\ The OCC bases its estimate of the number of small entities
on the Small Business Administration's size thresholds for
commercial banks and savings institutions, and trust companies,
which are $850 million and $47 million, respectively. Consistent
with the General Principles of Affiliation, 13 CFR 121.103(a), the
OCC counted the assets of affiliated financial institutions when
determining if it should classify an OCC-supervised institution as a
small entity. The OCC used average quarterly assets on December 31,
2024, to determine size because a ``financial institution's assets
are determined by averaging the assets reported on its four
quarterly financial statements for the preceding year.'' See
footnote 8 of the U.S. Small Business Administration's Table of Size
Standards.
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In general, the OCC classifies the economic impact on an individual
small entity as significant if the total estimated impact in one year
is greater than 5 percent of the small entity's total annual salaries
and benefits or greater than 2.5 percent of the small entity's total
non-interest expense. Furthermore, the OCC considers 5 percent or more
of OCC-supervised small entities to be a substantial number, and at
present, 30 OCC-supervised small entities would constitute a
substantial number. This final rule would impose no new mandates, and
thus no direct costs, on affected OCC-supervised institutions.
Therefore, the OCC certifies that this final rule would not have a
significant economic impact on a substantial number of small entities.
A Regulatory Flexibility Analysis is thus not required.
Unfunded Mandates Reform Act
The OCC has analyzed the final rule under the factors in the
Unfunded Mandates Reform Act of 1995 (UMRA).\42\ Under this analysis,
the OCC considered whether the final rule includes a Federal mandate
that may result in the expenditure by State, local, and tribal
governments, in the aggregate, or by the private sector, of $100
million or more in any one year ($187 million as adjusted annually for
inflation). Pursuant to section 202 of the UMRA,\43\ if a final rule
meets this UMRA threshold, the OCC would need to prepare a written
statement that includes, among other things, a cost-benefit analysis of
the proposal. The UMRA does not apply to regulations that incorporate
requirements specifically set forth in law.
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\42\ 2 U.S.C. 1531 et seq.
\43\ Id. 1532.
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This final rule would impose no new mandates, and thus no direct
costs, on affected OCC-supervised institutions. The OCC, therefore,
concludes that the final rule would not result in an expenditure of
$187 million or more annually by state, local, and tribal governments,
or by the private sector. Accordingly, the OCC has not prepared the
written statement described in section 202 of the UMRA.
Riegle Community Development and Regulatory Improvement Act of 1994
Pursuant to section 302(a) of the Riegle Community Development and
Regulatory Improvement Act of 1994, 12 U.S.C. 4802(a), in determining
the effective date and administrative compliance requirements for new
regulations that impose additional reporting, disclosure, or other
requirements on insured depository institutions, the OCC must consider,
consistent with principles of safety and soundness and the public
interest: (1) any administrative burdens that the final rule would
place on depository institutions, including small depository
institutions and customers of depository institutions; and (2) the
benefits of the final rule. In addition, section 302(b) of RCDRIA
requires new regulations and amendments to regulations that impose
additional reporting, disclosures, or other new requirements on insured
depository institutions generally to take effect on the first day of a
calendar quarter that begins on or after the date on which the
regulations are published in final form.
The OCC has considered the changes made by this final rule and
believes that the overall effective date of April 1, 2026, will provide
OCC-regulated institutions with adequate time to comply with the rule.
The final rule will not impose any new administrative compliance
requirements for OCC-regulated institutions.
Executive Order 12866
Executive Order 12866, titled ``Regulatory Planning and Review,''
as amended, requires the Office of Information and Regulatory Affairs
(OIRA), Office of Management and Budget (OMB) to determine whether a
final rule is a ``significant regulatory action'' prior to the
disclosure of the final rule to the public. If OIRA determines the
final rule to be a ``significant regulatory action,'' Executive Order
12866 requires the OCC to conduct a cost-benefit analysis of the final
rule. Executive Order 12866 defines a ``significant regulatory action''
as a regulatory action that is likely to (1) have an annual effect on
the economy of $100 million or more or adversely affect in a material
way the economy, a sector of the economy, productivity, competition,
jobs, the environment, public health or safety, or State, local, or
tribal governments or communities; (2) create a serious inconsistency
or otherwise interfere with an action taken or planned by another
agency; (3) materially alter the budgetary impact of entitlements,
grants, user fees, or loan programs or the rights and obligations of
recipients thereof; or (4) raise novel legal or policy issues arising
out of legal mandates, the President's priorities, or the principles
set forth in Executive Order 12866.
OMB has determined that this final rule is not a ``significant
regulatory action'' as defined in section 3(f) of Executive Order
12866.
Executive Order 14192
Executive Order 14192, titled ``Unleashing Prosperity Through
Deregulation,'' requires that an agency, unless prohibited by law,
identify at least 10 existing regulations to be repealed when the
agency publicly proposes for notice and comment or otherwise
promulgates a new regulation with total costs greater than zero.
Executive Order 14192 further requires that new incremental costs
associated with new regulations shall, to the extent permitted by law,
be offset by the elimination of existing costs associated
[[Page 9982]]
with at least ten prior regulations. This rule is not an Executive
Order 14192 regulatory action because this rule is not significant
under Executive Order 12866.
Congressional Review Act
For purposes of the Congressional Review Act, OMB makes a
determination as to whether a final rule constitutes a ``major rule.''
\44\ If a rule is deemed a ``major rule'' by OMB, the Congressional
Review Act generally provides that the rule may not take effect until
at least 60 days following its publication.\45\
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\44\ 5 U.S.C. 801 et seq.
\45\ 5 U.S.C. 801(a)(3).
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The Congressional Review Act defines a ``major rule'' as any rule
that the Administrator of the Office of Information and Regulatory
Affairs of the OMB finds has resulted in or is likely to result in: (1)
an annual effect on the economy of $100,000,000 or more; (2) a major
increase in costs or prices for consumers, individual industries,
Federal, State, or local government agencies, or geographic regions; or
(3) significant adverse effects on competition, employment, investment,
productivity, innovation, or on the ability of United States-based
enterprises to compete with foreign-based enterprises in domestic and
export markets.\46\
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\46\ 5 U.S.C. 804(2).
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OMB has determined that the final rule is not a major rule for
purposes of the Congressional Review Act. As required, the OCC will
submit the final rule and other appropriate reports to Congress and the
Government Accountability Office for review.
List of Subjects in 12 CFR Part 5
Administrative practice and procedure, National banks, Reporting
and recordkeeping requirements, Savings associations, Securities.
Authority and Issuance
For the reasons set forth in the preamble, and under the authority
of 12 U.S.C. 93a, the OCC amends chapter I of title 12 of the Code of
Federal Regulations as follows:
PART 5--RULES, POLICIES, AND PROCEDURES FOR CORPORATE ACTIVITIES
0
1. The authority citation for part 5 continues to read as follows:
Authority: 12 U.S.C. 1 et seq., 24a, 35, 93a, 214a, 215, 215a,
215a-1, 215a-2, 215a-3, 215c, 371d, 481, 1462a, 1463, 1464, 1817(j),
1831i, 1831u, 2901 et seq., 3101 et seq., 3907, and 5412(b)(2)(B).
0
2. Amend Sec. 5.20 by revising paragraphs (e)(1)(i) and (l)(1) to read
as follows:
Sec. 5.20 Organizing a national bank or Federal savings association
* * * * *
(e) * * *
(1) * * *
(i) The OCC charters a national bank under the authority of the
National Bank Act of 1864, as amended, 12 U.S.C. 1 et seq. The bank may
be a special purpose bank that limits its activities to the operations
of a trust company and activities related thereto or to any other
activities within the business of banking. A special purpose bank that
conducts activities other than the operations of a trust company and
activities related thereto must conduct at least one of the following
three core banking functions: Receiving deposits; paying checks; or
lending money. The name of a proposed national bank must include the
word ``national.''
* * * * *
(l) * * *
(1) In general. A filer for a national bank or Federal savings
association charter that will limit its activities to the operations of
a trust company and activities related thereto, credit card operations,
or another special purpose must adhere to established charter
procedures with modifications appropriate for the circumstances as
determined by the OCC. A filer for a national bank or Federal savings
association charter that will have a community development focus must
also adhere to established charter procedures with modifications
appropriate for the circumstances as determined by the OCC. A national
bank that seeks to invest in a bank or savings association with a
community development focus must comply with applicable requirements of
12 CFR part 24. A Federal savings association that seeks to invest in a
bank or savings association with a community development focus must
comply with Sec. 160.36 or any other applicable requirements.
* * * * *
Jonathan V. Gould,
Comptroller of the Currency.
[FR Doc. 2026-04088 Filed 2-27-26; 8:45 am]
BILLING CODE 4810-33-P