US Reg Round Up: 18/06/2024

Securities and Exchange Commission

SEC invites regulated entities to submit self-assessment of diversity- 5 June 2024

The Securities and Exchange Commission (SEC) has initiated its biennial collection of Diversity Self-Assessment Submissions from regulated entities. This process allows organizations to evaluate their diversity and inclusion policies, identifying strengths, opportunities, risks, and vulnerabilities. The SEC utilizes the data from these submissions to monitor and report on progress and trends in diversity-related activities among regulated entities. Submitting diversity self-assessments is voluntary and is not part of the SEC's examination process. Regulated entities can use the SEC’s Diversity Self-Assessment Tool (DSAT) or submit their assessments in their preferred format.

Office of the Comptroller of the Currency

Acting controller discusses AI and Financial Stability - 6 June 2024

Michael J. HSU discussed systemic risk implications of AI in Banking and Finance, discussing how AI can be used as either a tool or as a weapon, it all depends on how is wielding such tool. Michael highlights how banks, corporations, governments, and others are quickly exploring the use cases of AI and if the past is any guide, micro and macro prudential risks from such quick adoption will be a problem without sufficiently developed controls. The evolution of electronic trading illustrates technological advancement and its impact on risk management. Initially, trading was manual, transitioning to phone-based systems enhanced by computers providing real-time data. Over time, computers not only supplied information but also assisted traders, enabling faster and more complex strategies. Eventually, algorithms fully automated trades based on pre-set instructions. By drawing parallels between the evolution of electronic trading and AI, banks can better understand the stages of AI integration and the corresponding need for robust risk management. Implementing clear transitional gates and ensuring stringent controls at each phase

Acting comptroller discusses improving consumer financial health - 6 June 2024

During a presentation at the Emerge Financial Health conference in Chicago, Hsu discussed the Office of the Comptroller of the Currency’s (OCC) efforts to enhance customer financial health. Hsu highlighted the OCC's work in defining and developing voluntary financial health measures for banks to support customer financial stability, resilience, and security. Additionally, Hsu announced the release of an OCC report detailing three "Financial Health Vital Signs" that banks can use to assess their customers' financial health.

OCC release May 2024 community reinvestment act performance evaluations - 6 June 2024

The Office of the Comptroller of the Currency (OCC) has published a list of Community Reinvestment Act (CRA) performance evaluations for the period from May 1, 2024, to May 31, 2024. This list includes national banks, federal savings associations, and insured federal branches of foreign banks that have received CRA ratings. The possible ratings are outstanding, satisfactory, needs to improve, and substantial noncompliance. In this release, out of 19 evaluations, 11 were rated satisfactory, and eight were rated outstanding. None were rated as needs to improve or substantial noncompliance. The detailed evaluations can be accessed by clicking on the institution's charter number in the provided list. Additionally, the OCC's website offers a searchable list of all public CRA evaluations.