OCC updates minority depository institutions policy statement for statutory alignment

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OCC updates MDI policy

Highlights

OCC updates its policy statement on minority depository institutions (MDIs) to align with Executive Order 14219 and eliminate unsupported provisions.
The revised policy adopts the statutory MDI definition from FIRREA, focusing on ownership by socially and economically disadvantaged individuals without listing presumed groups.
OCC removes outdated references to agency structures and programs, instructing banks to use supervisory field offices for MDI resource inquiries, affecting all OCC-supervised banks.

Policy revisions and legal alignment

As reported by the Office of the Comptroller of the Currency, the updated policy statement is published in the Federal Register and reflects the agency's review of regulations for consistency with Executive Order 14219. The OCC says the revisions remove provisions considered unnecessary, not based on the best reading of underlying statutory authority, or lacking clear statutory authority.

The revised statement bases the MDI definition more closely on the statutory definition in the Financial Institutions Reform, Recovery, and Enforcement Act of 1989. For national banks and federal stock savings associations, that statute defines an MDI based on ownership by socially and economically disadvantaged individuals, without specifying any group presumed to meet that standard.

The agency also explains how it may maintain the designation of current MDIs. Under the previous policy statement, the OCC could continue designating a bank as an MDI at its discretion in certain circumstances even when the bank no longer met the statutory definition.

Operational impact for OCC-supervised banks

The OCC says the updated definition and the continued recognition of current MDIs are meant to improve consistency with FIRREA while minimizing disruption for institutions that already hold the designation. The bulletin applies to all OCC-supervised banks, indicating a broad compliance relevance across the regulator's supervised institutions.

Beyond the definition changes, the OCC removes references to specific agency structures, resources, and programs that it says have become obsolete or are vulnerable to obsolescence. It replaces those references with more general directions, a change the agency says should extend the policy statement's usefulness and reduce future confusion.

The regulator adds that banks and other parties with questions about OCC resources and programs should contact their supervisory field office. That approach shifts operational guidance away from detailed policy text and toward current supervisory channels.

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