Five federal financial supervisory agencies Monday released a Memorandum of Understanding that clarifies how they will coordinate their supervisory activities, consistent with the Dodd-Frank Act.
Section 1025 of Dodd-Frank requires that the Consumer Financial Protection Bureau, along with the NCUA, FDIC, Federal Reserve, and the Office of the Comptroller of the Currency, coordinate aspects of their supervision of insured depository institutions with more than $10 billion in assets.
The coordination includes scheduling examinations, conducting simultaneous examinations of covered depository institutions unless an institution requests separate examinations, and sharing draft reports of examination for comment.
The MOU is intended to establish arrangements for coordination and cooperation between the CFPB and the prudential regulators, minimize unnecessary regulatory burden, avoid unnecessary duplication of effort, and decrease the risk of conflicting supervisory directives, according to a Fed release.
Under the MOU, the agencies will coordinate examinations and other supervisory activities and share certain material supervisory information concerning compliance with federal consumer financial laws and certain other federal laws that regulate consumer financial products and services; consumer compliance risk management programs; activities such as underwriting, sales, marketing, servicing, collections, if they are related to consumer financial products or services; and other related matters that the agencies may mutually agree upon.
These coordination undertakings should lead to greater uniformity and efficiencies in supervision and help to minimize regulatory burden on covered depository institutions, according to the Fed release.