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The Office of the Comptroller of the Currency recently graded the 19 largest banks on five factors designed to gauge how well they are being run. The results are shocking.
December 13 -
Banks shouldn't go to extremes to make up for declining earnings, Comptroller of the Currency Thomas Curry said Friday.
November 9 -
Comptroller of the Currency Tom Curry said the agency is ready to "take action" against banks that lower provisions solely to boost short-term profits.
October 29
When American Banker Editor at Large Barb Rehm
"The gun is still pointed at our heads," said one. "Wake up folks, it ain't free market capitalism. They screw up; we pay. Plain and simple."
"Who is running [the U.S.'s] largest banks?" another commenter wrote. "They need to be told, reminded and required by regulators about internal auditing, risk management and succession planning – about motherhood and apple pie? What are the bank leadership and management there for?"
Still, others pointed out the failures may not be solely attributable to bad corporate governance.
"I think after the 2008 crisis, national banks are being held to higher and tighter standards than ever before," one reader wrote.
That view was supported by Michael Brosnan, the head of the OCC's large-bank supervision who walked Rehm through the test results she'd obtained.
"We've raised the bar significantly," he acknowledged. Brosnan went on to emphasize that the OCC's latest tests differ dramatically from the ones big banks have grown used to.
"It's just a shift in focus," Rob Blackwell, American Banker's Washington Bureau chief explained in a follow-up
One reader argued this shift in focus was less about preventing another financial crisis than about the OCC trying to overhaul a reputation for being in the big banks' pockets.
"Throw one more regulator in with the pile and let them all have a contest to see who is the toughest," the reader wrote. "I'm sure that will help free up lending for the masses."
What do you think contributed to the dismal performance? Are the megabanks failures at governing themselves or have standards just become much more stringent? Share your views in the comments sections below.
Jeanine Skowronski is the deputy editor of BankThink. You can contact her at
