Effective date for OCC repeal of employment contracts rule for FSAs

The OCC has issued OCC Bulletin 2020-60 announcing it has issued a final rule regarding employment contracts and mutual to stock conversions. The rule also includes technical amendments.

Consistent with recommendations in the EGRPRA report to reduce burden and increase flexibility for banks, the final rule repeals the requirement that employment contracts with federal savings association (FSA) employees be in writing and approved by the FSA’s board of directors.

The final rule also amends the OCC’s rule for conversions from mutual to stock form of a savings association to reduce burden, provide clarity, increase flexibility, and update cross-references. The rule also updates cross-references to repealed and integrated rules, removes unnecessary definitions, and makes technical changes to other OCC rules.

The rule, which will amend 12 CFR Parts 3, 4, 8, 11, 16, 19, 23, 26, 32, 108, 112, 141, 160, 161, 163, and 192, will become effective 30 days after its publication in the Federal Register.

Editor's note: The Economic Growth and Regulatory Paperwork Reduction Act of 1996 (EGRPRA) requires that regulations prescribed by the FFIEC, OCC, FDIC, and Federal Reserve Board be reviewed by the agencies at least once every 10 years. The purpose of this review is to identify, with input from the public, outdated, unnecessary, or unduly burdensome regulations and consider how to reduce regulatory burden on insured depository institutions while, at the same time, ensuring their safety and soundness and the safety and soundness of the financial system. The most recent EGRPRA Report was submitted to Congress on March 21, 2017.

Publication information: Published at 85 FR 42630 on July 14, 2020, with an effective date of August 13, 2020.