Bank regulations in the United States come from several federal agencies working alongside state regulators, and they cover how banks are chartered, how much capital they hold, how they treat customers, how they lend, and what they must report to the government. The rules below are the ones that shape day-to-day banking.
Who Regulates Banks
The Office of the Comptroller of the Currency charters, regulates, and supervises all national banks and federal savings associations.1OCC. OCC – About the OCC State-chartered banks answer to a state regulator plus a federal one: the Federal Reserve Board for state-chartered banks that belong to the Federal Reserve System, and the FDIC for those that do not.2OCC. OCC – Index of Financial Institution Lists
Consumer protection sits largely with the Consumer Financial Protection Bureau, which has primary authority to enforce federal consumer financial laws at banks and other depository institutions with more than $10 billion in total assets.3CFPB. CFPB – Supervision The FDIC also protects customers directly by insuring deposits.2OCC. OCC – Index of Financial Institution Lists
Capital and Liquidity Rules
Banks must hold capital as a cushion against losses. Federal Reserve rules require regulated banks to calculate and maintain specific capital ratios measured against their risk-weighted assets, so the amount of capital a bank needs rises with the riskiness of what it holds.4Federal Reserve. 12 C.F.R. § 217.10
Liquidity is regulated separately. Certain large institutions must meet a Liquidity Coverage Ratio by holding enough high-quality liquid assets to cover total net cash outflows during a period of stress.5Federal Reserve. 12 C.F.R. § 249.10 The point is to keep funds available when withdrawals or other pressures spike.
Deposit Insurance and Customer Protections
FDIC insurance protects deposits if an insured bank fails.6FDIC. FDIC – Understanding Deposit Insurance The standard limit is $250,000 per depositor, per insured bank, for each account ownership category. Covered account types include:7FDIC. FDIC – Deposit Insurance at a Glance
- Checking accounts
- Savings accounts
- Money market deposit accounts
- Certificates of Deposit (CDs)
Financial institutions must also give customers a clear and conspicuous notice that accurately reflects their privacy policies and practices.8CFPB. 12 C.F.R. § 1016.4 On top of that, federal law prohibits covered financial service providers from engaging in unfair, deceptive, or abusive acts or practices when dealing with consumers.9GovInfo. 12 U.S.C. § 5536 – Section: Prohibited acts
Fair Lending and Community Reinvestment
The Equal Credit Opportunity Act prohibits discrimination in any aspect of a credit transaction based on race, color, religion, national origin, sex, marital status, or age.10Department of Justice. DOJ – Equal Credit Opportunity Act The Community Reinvestment Act requires federal regulators to assess how well a bank meets the credit needs of its entire community, including low- and moderate-income neighborhoods, and that record is considered when the institution applies for a deposit facility.11LII / Legal Information Institute. 12 U.S.C. § 2903
Reporting Requirements to Prevent Financial Crime
Banks have to flag certain activity for the government. A currency transaction report is required for physical currency transactions totaling more than $10,000 in a single business day.12FinCEN. FinCEN – Currency Transaction Report Guidance A Suspicious Activity Report must be filed no later than 30 calendar days after the initial detection of facts that might indicate a potentially criminal transaction.13Federal Reserve. 12 C.F.R. § 208.62
When Deposits Must Be Available
Federal rules govern how quickly deposited funds must be released to customers. Banks generally must provide next-day availability for cash, electronic payments, and certain government checks, though specific conditions apply to some items.14Federal Reserve. 12 C.F.R. § 229.10 For other checks, the law sets different availability schedules, so a bank may apply a temporary hold before the customer can withdraw the funds.15Federal Reserve. 12 C.F.R. § 229.12