It's helpful to think about why we have Reg O. A while back, some greedy folks took advantage of their position as bank insiders, and made themselves "sweetheart" deal loans that were very speculative, or were just out-and-out fraudulent loans.
These loans were not small by any means, and contributed to the failure of the bank.
Don't know that the renting of a safe deposit box could jeopardize the Safety and Soundness of the Bank.
I suppose you could make an extreme example of an insider taking up all of the bank's Safe Deposit Boxes for free, and that could be a money-loser for the bank, but what are the odds?
Regulations are a poor substitute for ethics.