*Economic Growth & Regulatory Paperwork Reduction Act of 1996 (P.L. 104-208, 110 STAT. 3009)*
The Economic Growth & Regulatory Paperwork Reduction Act of 1996 ("EGRPRA") was encated in 1996 to reduce regulatory burden on financial institutions. Most significantly, it required the FFIEC and appropriate federal banking agencies to periodically review their regulations, through the notice and public comment process, and to "eliminate unnecessary regulations to the extent such action is appropriate." 12 U.S.C. § 3311.
- Requires the Federal Financial Institutions Examination Council and its member agencies (FDIC, OCC, FRB, NCUA, and formerly OTS which has not been repalced on the FFIEC by the CFPB) to review their regulations at least once every 10 years to identify any outdated, unnecessary or unduly burdensome regulatory requirements imposed on insured depository institutions.
- The federal banking agencies must also provide Congress with an analysis of the issues raised in public comments, and whether the agencies are 'able to address the regulatory burdens associated with such issues by regulation, or whether such burdens must be addressed by legislative action." 12 U.S.C. § 3311(e).
- Modified financial institution supervisory regulations, including regulations impeding the flow of credit from lending institutions to businesses and consumers.
- Amended the Truth in Lending Act and the Real Estate Settlement Procedures Act of 1974 to streamline the mortgage lending process.
- Amended the FDIA to eliminate or revise various application, notice, and recordkeeping requirements to reduce regulatory burden and the cost of credit.
- Amended the Fair Credit Reporting Act to strengthen consumer protections relating to credit reporting agency practices.
- Authorized the FTC to enforce consumer protections over credit repair services.
- Clarified lender liability and federal agency liability issues under the CERCLA.
- Directed FDIC to impose a special assessment on depository institutions to recapitalize the SAIF, aligned SAIF assessment rates with BIF assessment rates and merged the SAIF and BIF into a new Deposit Insurance Fund.
Why is the EGRPRA still relevant?
The State Liaison Committee (SLC) was added to the FFIEC as a voting member in 2006. The SLC includes representation from the Cofnerence of State Bank Supervisors (CSBS), the American Council of State Savings Supervisors (ACSSS), and the National Association of State Credit Union Supervisors (NASCUS).
The FFIEC's first review, reported in 2007, identified four areas for potential regulatory revision: suspicious activity reports, lending limits, the Basel II capital framework, and consumer disclosures.1 The next retrospective EGRPRA review must be completed by 2016. The FDIC, for example, is already preparing to publish review process plans for comments by early 2012.2 Since the passage of Dodd-Frank, it will be important for federal banking agencies to continue periodic reviews to facilitate efficient regulation and streamline supervisory processes. Through the public comment processes in EGRPRA reviews, the Act is necessary to balance the needs of both consumers and industry, as well as the role of state banking regulators.
Jenny S. Kim
Assistant General Counsel
Florida Office of Financial Regulation, Division of Finance