FEDERAL RESERVE SYSTEM ISSUES PROPOSED RULE: PROHIBITION ON USE OF REPUTATION RISK OR OTHER SUPERVISORY TOOLS TO ENCOURAGE OR COMPEL BANKING ORGANIZATIONS TO ENGAGE IN POLITICIZED OR UNLAWFUL DISCRIMINATION

WASHINGTON, Feb. 26 -- Federal Reserve System has issued a proposed rule called: Prohibition on Use of Reputation Risk or Other Supervisory Tools To Encourage or Compel Banking Organizations To Engage in Politicized or Unlawful Discrimination.

The proposed rule was published in the Federal Register on Feb. 26 by Benjamin W. McDonough, Deputy Secretary of the Board.

Summary: The Board of Governors of the Federal Reserve System (Board) is inviting public comment on a notice of proposed rulemaking (proposal or proposed rule) that would codify the removal of reputation risk from the Board's supervisory programs. The proposal would prohibit the Board from encouraging or compelling Board-supervised banking organizations to deny or condition the...