Policy Statement on Section 9(13) of the Federal Reserve Act (2025; rescinds 2023 statement), 90 FR 59731, FR Doc 2025-23548
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59731
Rules and Regulations Federal Register
Vol. 90, No. 243
Monday, December 22, 2025
This section of the FEDERAL REGISTER 0911, Legal Division; or Juan Climent, Board’s commitment to the principle of
contains regulatory documents having general Deputy Associate Director, (202) 872– ‘‘same activity, same risks, same
applicability and legal effect, most of which 7526 and Jeff Ernst, Manager, (202) 369– regulation’’ and the reciprocal principle
are keyed to and codified in the Code of 9439, Division of Supervision and of ‘‘different activity, different risks,
Federal Regulations, which is published under Regulation, Board of Governors of the different regulation’’ in a manner
50 titles pursuant to 44 U.S.C. 1510.
Federal Reserve System, 20th Street and designed to facilitate innovation by state
The Code of Federal Regulations is sold by C Streets NW, Washington, DC 20551. member banks, and (ii) provides further
the Superintendent of Documents. For users of TTY–TRS, please call 711 guidance to uninsured state member
from any telephone, anywhere in the banks and uninsured state-chartered
United States. bank applicants for membership who
FEDERAL RESERVE SYSTEM SUPPLEMENTARY INFORMATION: may seek to engage in activities as
principal that are not permissible for
12 CFR Part 208 I. Background insured state member banks.
[Docket No. OP–1876] Under section 9(13) of the Federal
II. Rescission of the 2023 Policy
Reserve Act (FRA), the Board of
RIN 7100–AH14 Statement
Governors of the Federal Reserve
System (Board) ‘‘may limit the activities In January 2023, the Board published
Policy Statement on Section 9(13) of the 2023 Policy Statement,4 which set
of State member banks and subsidiaries
the Federal Reserve Act out a rebuttable presumption that the
of State member banks in a manner
AGENCY: Board of Governors of the consistent with section 24 of the Federal Board would exercise its discretion
Federal Reserve System. Deposit Insurance Act [(FDIA)].’’ 1 under section 9(13) of the FRA to limit
ACTION: Final rule; rescission of a policy Section 24 prohibits an insured State the authority of state member banks to
statement; issuance of a policy bank from engaging ‘‘as principal in any engage as principal in only those
statement. type of activity that is not permissible activities that are permissible for
for a national bank unless—(A) the national banks—in each case, subject to
SUMMARY: The Board of Governors of the [Federal Deposit Insurance Corporation the terms, conditions, and limitations
Federal Reserve System (Board) is (FDIC)] has determined that the activity placed on national banks with respect to
rescinding its 2023 policy statement would pose no significant risk to the the activity—unless those activities are
interpreting section 9(13) of the Federal Deposit Insurance Fund; and (B) the permissible for state-chartered banks by
Reserve Act (FRA) (2023 Policy State bank is, and continues to be, in federal statute or under part 362 of the
Statement), which set out a presumption compliance with applicable capital FDIC’s regulations. The 2023 Policy
for how the Board would exercise its standards prescribed by the appropriate Statement also (i) reiterated to state
authority under that provision and Federal banking agency.’’ 2 In 2023, the member banks that legal permissibility
elaborated on supervisory expectations Board issued a policy statement is a necessary, but not sufficient,
at that time related to ‘‘novel and interpreting section 9(13) (2023 Policy condition to establish that a state
unprecedented’’ activities. The Board is Statement), setting out a presumption member bank may engage in a particular
also withdrawing from the record the for how the Board intended to use its activity; (ii) reminded state member
SUPPLEMENTARY INFORMATION that authority under the provision and banks that they must at all times
accompanied the 2023 Policy Statement, elaborating on supervisory expectations conduct their business and exercise
which discussed specific crypto-asset at that time regarding ‘‘novel and their powers with due regard to safety
activities. The Board is replacing the unprecedented’’ activities.3 and soundness, including by having in
2023 Policy Statement with a new At this time, the Board has concluded place appropriate internal controls and
policy statement on section 9(13) of the that it is appropriate to rescind the 2023 information systems; and (iii)
FRA, which is designed to facilitate Policy Statement and replace it with a highlighted particular risks associated
innovation by state member banks in a new policy statement (2025 Policy with, and supervisory expectations for,
manner that is consistent with bank Statement) describing the Board’s ‘‘novel and unprecedented’’ activities.
safety and soundness and preserving the intention to interpret section 9(13) of Furthermore, the 2023 Preamble
stability of the U.S. financial system. the FRA in a manner designed to discussed how the 2023 Policy
The new policy statement also provides facilitate innovation by state member Statement would presumptively apply
guidance to uninsured state member banks, consistent with bank safety and to particular sets of facts related to
banks and uninsured state-chartered soundness and preserving the stability certain crypto-asset activities at the
bank applicants for membership who of the U.S. financial system. The Board time.
may seek to engage in activities as is also withdrawing from the record The 2023 Policy Statement was part of
principal that are not permissible for portions of the SUPPLEMENTARY a series of Board or Board staff issuances
INFORMATION (2023 Preamble) discussing
in 2022 and 2023 related to crypto-asset
insured state member banks.
specific crypto-asset activities. The 2025 activities and supervisory expectations
DATES: This final rule and policy for such activities. Recently, those
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statement is effective on December 22, Policy Statement (i) articulates the
2025. 4 See Press Release: Federal Reserve Board issues
1 12 U.S.C. 330 (as amended by Federal Deposit
FOR FURTHER INFORMATION CONTACT: policy statement to promote a level playing field for
Insurance Corporation Improvement Act of 1991 all banks with a federal supervisor, regardless of
Asad Kudiya, Associate General § 303(b), Public Law 102–242, 105 Stat. 2236, 2353). deposit insurance status (Jan. 27, 2023), available at
Counsel, (202) 475–6358 and Kelley 2 12 U.S.C. 1831a(a). See 12 CFR part 362.
https://www.federalreserve.gov/newsevents/
O’Mara, Special Counsel, (202) 430– 3 88 FR 7848 (Feb. 7, 2023); 12 CFR 208.112. pressreleases/bcreg20230127a.htm.
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59732 Federal Register / Vol. 90, No. 243 / Monday, December 22, 2025 / Rules and Regulations
issuances have been rescinded or a national bank has not been authorized uninsured state member bank has
withdrawn.5 The Board believes these by federal law, including the National received the permission of the Board
statements are no longer appropriate Bank Act, to engage in an activity, then under section 208.3(d)(2) of the Board’s
given its evolving understanding of the national banks are not permitted to Regulation H.12 Under that provision, a
risks of the crypto-asset sector and its engage in such activity. state member bank may not, without the
desire to facilitate innovation in a permission of the Board, change the
B. Application
manner consistent with safety and general character of its business or the
soundness and preserving the stability The 2025 Policy Statement applies to scope of the corporate powers it
of the U.S. financial system. Similarly, insured and uninsured state member
exercised at the time of its admission to
at this time, the Board has determined banks. Insured state member banks,
membership.13 To the extent firms have
it should rescind the 2023 Policy however, are already required by section
24 of the FDIA and part 362 of the inquiries regarding legal permissibility,
Statement in its entirety, including the Board will engage with the FDIC and
related guidance in the 2023 Preamble. FDIC’s regulations to seek approval from
the FDIC when seeking to conduct an OCC as appropriate, consistent with this
II. 2025 Policy Statement activity as principal that is not policy statement.
The Board continues to believe it is permissible for national banks. As In determining whether to grant an
beneficial to provide transparency to the established under those provisions, uninsured state member bank or an
public regarding its interpretation of insured state member banks may not uninsured state-chartered bank
section 9(13) of the FRA, as well as how engage as principal in any type of applicant for membership permission to
it intends to use its authority under the activity that is not permissible for a engage in an activity as principal that is
provision. Therefore, the Board is national bank unless—(i) the FDIC has not permissible for insured state
replacing its 2023 Policy Statement with determined that the activity would pose member banks, the Board, under the
the 2025 Policy Statement. no significant risk to the Deposit 2025 Policy Statement, will consider
Insurance Fund; and (ii) the insured whether the uninsured state member
A. Legal Authority state member bank is, and continues to bank would be capable of engaging in
Under section 9(13) of the Act, the be, in compliance with applicable such activity in a manner that is
Board ‘‘may limit the activities of State capital standards prescribed by the consistent with bank safety and
member banks and subsidiaries of State Board.10 soundness and preserving the stability
member banks in a manner consistent If an activity is authorized for national
of the U.S. financial system. The Board
with section 24 of the [FDIA].’’ 6 Section banks to conduct as principal, it is
generally permissible for insured state may consider (i) the regulatory
24 prohibits an insured State bank from
member banks to conduct as principal, framework to which the uninsured state
engaging ‘‘as principal in any type of
provided the activity is permitted under member bank is subject; (ii) the risks
activity that is not permissible for a
relevant state law and the bank adheres presented by the proposed activities and
national bank unless—(A) the [FDIC]
has determined that the activity would to the terms, conditions, and limitations the bank’s planned internal controls
pose no significant risk to the Deposit placed on national banks by the OCC framework to address such risks; and
Insurance Fund; and (B) the State bank with respect to the activity. (iii) how the institution would mitigate
is, and continues to be, in compliance Furthermore, if the FDIC, by rule, the risks otherwise addressed by deposit
with applicable capital standards permits insured state-chartered banks to insurance and FDIC resolution. Among
prescribed by the appropriate Federal engage in the activity as principal even other things, the Board may consider
banking agency.’’ 7 if that activity is not permissible for whether the uninsured state member
The National Bank Act enumerates national banks, it is generally bank has a financial profile that is at
certain powers that national banks may permissible for insured state member least as effective as deposit insurance in
exercise and authorizes national banks banks to engage in the activity as minimizing the risk of deposit runs and
to exercise ‘‘all such incidental powers principal, provided the activity is contagion. This may, for example, be
as shall be necessary to carry on the permitted under state law. If there is no demonstrated if the uninsured state
business of banking.’’ 8 Section 7.1000 authority for an insured state-chartered member bank has (i) a sufficient amount
of the OCC’s regulations identifies the bank to engage in a particular activity as of total loss-absorbing capacity
criteria that the OCC uses to determine principal under federal statute or part (consisting of capital and long-term
whether an activity is authorized as part 362 of the FDIC’s regulations, an debt) that is subordinate to the bank’s
of, or incidental to, the business of insured state member bank should deposits and other short-term liabilities;
banking under 12 U.S.C. 24(Seventh).9 If apply to the FDIC for permission to or (ii) high-quality liquid assets equal to
engage in the activity as principal under 100 percent of the bank’s demand
5 See, e.g., Press Release: Federal Reserve Board part 362 of the FDIC’s regulations.11 deposits and other short-term liabilities.
announces the withdrawal of guidance for banks Furthermore, if the FDIC has permitted The Board may also consider whether
related to their crypto-asset and dollar token
activities and related changes to its expectations for
only specific insured state-chartered the uninsured state member bank has a
these activities (Apr. 24, 2025), available at https:// bank(s) to engage in the activity as resolution plan that demonstrates how
www.federalreserve.gov/newsevents/pressreleases/ principal, other insured state-chartered the bank could be recapitalized or
bcreg20250424a.htm; Press Release, Federal banks must similarly apply to the FDIC
Reserve Board announces it will sunset its novel
wound down in an orderly manner if it
activities supervision program and return to
for specific permission. fails to remain a viable going concern.
monitoring banks’ novel activities through the An uninsured state member bank may
normal supervisory process (Aug. 15, 2025), not engage in any activity as principal 12 12 CFR 208.3(d)(2).
available at https://www.federalreserve.gov/ that is not authorized for national banks
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13 Uninsured state member banks must receive
newsevents/pressreleases/bcreg20250815a.htm.
6 12 U.S.C. 330 (as amended by Federal Deposit
or insured state-chartered banks, unless approval from the Board for permission to conduct
the Board has provided otherwise by an activity as principal, if the FDIC has permitted
Insurance Corporation Improvement Act of 1991 the activity only for specific insured state bank(s).
§ 303(b), Public Law 102–242, 105 Stat. 2236, 2353). regulation, order, or other means, or the In such case, the fact that the FDIC has approved
7 12 U.S.C. 1831a(a). See 12 CFR part 362.
at least one insured state-chartered bank to engage
8 12 U.S.C. 24(Seventh). 10 12 U.S.C. 1831a(a)(1).
in the activity would be highly pertinent to the
9 12 CFR 7.1000. 11 See 12 CFR part 303, subpart G. Board’s analysis.
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Federal Register / Vol. 90, No. 243 / Monday, December 22, 2025 / Rules and Regulations 59733
III. Regulatory Analyses Authority: 12 U.S.C. 24, 36, 92a, 93a, (d) If an activity is authorized for
248(a), 248(c), 321–338a, 371d, 461, 481–486, national banks to conduct as principal,
This rule clarifies how the Board 601, 611, 1814, 1816, 1817(a)(3), 1817(a)(12),
interprets and intends to exercise its it is generally permissible for State
1818, 1820(d)(9), 1833(j), 1828(o), 1831,
discretion under section 9(13) of the 1831o, 1831p–1, 1831r–1, 1831w, 1831x, member banks to conduct as principal,
Act. It is not itself binding on state 1835a, 1882, 2901–2907, 3105, 3310, 3331– provided that it is permitted under
member banks. Accordingly, the 3351, 3905–3909, 5371, and 5371 note; 15 relevant State law and the bank adheres
provisions of the Administrative U.S.C. 78b, 78I(b), 78l(i), 780–4(c)(5), 78q, to the terms, conditions, and limitations
Procedure Act (APA) regarding notice of 78q–1, 78w, 1681s, 1681w, 6801, and 6805; placed on national banks by the OCC
proposed rulemaking and opportunity 31 U.S.C. 5318; 42 U.S.C. 4012a, 4104a, with respect to the activity.
4104b, 4106, and 4128.
for public participation are not (e) If the FDIC, by rule, permits
applicable.14 Subpart J—Interpretations insured State-chartered banks to engage
Because no notice of proposed in any activity as principal under
rulemaking is required to be issued, or ■ 2. Revise § 208.112 to read as follows: section 24 of the Federal Deposit
has been issued, in connection with this Insurance Act that is not permissible for
rule, it is not a ‘‘rule’’ for purposes of § 208.112. Policy statement on section
9(13) of the Federal Reserve Act. national banks, it is generally
the Regulatory Flexibility Act, and that
(a) Under section 9(13) of the Federal permissible for State member banks to
act, therefore, does not apply.15
In accordance with the Paperwork Reserve Act (12 U.S.C. 330), a State engage in that activity, provided it is
Reduction Act of 1995 (PRA),16 the member bank may exercise all corporate permitted under applicable State law. If
Board may not conduct or sponsor, and powers granted it by the State in which there is no authority for an insured
a respondent is not required to respond it was created except that the Board may State-chartered bank to engage in a
to, an information collection unless it limit the activities of State member particular activity as principal under
displays a currently valid Office of banks and subsidiaries of State member Federal statute or part 362 of the FDIC’s
Management and Budget control banks in a manner consistent with regulations, that activity must be
number. The Board has reviewed the section 24 of the Federal Deposit authorized for insured depository
rule and has determined that it contains Insurance Act.’’ The Board interprets institutions by the FDIC under section
no collections of information as defined this provision as vesting in the Board 24 of the Federal Deposit Insurance Act
in the PRA. the authority to prohibit or otherwise (12 U.S.C. 1831a) and the insured State
Section 722 of the Gramm-Leach- restrict State member banks and their member bank must be in compliance
Bliley Act 17 requires the federal subsidiaries from engaging as principal with applicable capital requirements
banking agencies to use plain language in any activity (including acquiring or issued by the Board.
in all proposed and final rules retaining any investment) that is not
(f) An uninsured State member bank
published after January 1, 2000. The permissible for a national bank, unless
the activity is permissible for State- may not engage in any activity as
Board has sought to present this rule in
chartered banks by Federal statute or principal that is not authorized for
a simple and straightforward manner.
The APA does not require the Board under section 24(a) of the Federal national banks or insured State-
to delay the effective date of the rule.18 Deposit Insurance Act. chartered banks, unless the Board has
Accordingly, the rule is effective (b) The Board generally believes that provided otherwise by regulation, order,
December 22, 2025. the same activity, presenting the same or other means, or the uninsured State
risks, should be subject to the same member bank has received the
List of Subjects in 12 CFR Part 208 regulatory framework, and that a permission of the Board under
Accounting, Agriculture, Banks, different activity, presenting different § 208.3(d)(2) of the Board’s Regulation
banking, Confidential business risks, should be subject to a different H. In determining whether to grant an
information, Consumer protection, regulatory framework. Consistent with uninsured state member bank or an
Crime, Currency, Federal Reserve this principle, the Board intends to uninsured State-chartered bank
System, Flood insurance, Insurance, interpret section 9(13) of the Federal applicant for membership permission to
Investments, Mortgages, Reporting and Reserve Act (12 U.S.C. 330) to facilitate engage in an activity as principal that is
recordkeeping requirements, Securities. innovation by insured and uninsured not permissible for insured State
State member banks in a manner member banks, the Board will consider
Authority and Issuance
consistent with safety and soundness of whether the uninsured State member
For the reasons stated in the State member banks and preserving the bank would be capable of engaging in
preamble, the Board of Governors of the stability of the U.S. financial system. such activity in a safe and sound
Federal Reserve System amends part (c) In alignment with this principle, manner and in a manner that is
208 of chapter II of title 12 of the Code the Board generally presumes that it consistent with preserving the stability
of Federal Regulations as follows: will exercise its discretion under section of the U.S. financial system.
9(13) of the Federal Reserve Act (12
PART 208—MEMBERSHIP OF STATE U.S.C. 330) to limit the authority of By order of the Board of Governors of the
BANKING INSTITUTIONS IN THE insured State member banks and their Federal Reserve System.
FEDERAL RESERVE SYSTEM subsidiaries to engage in any activity as Benjamin W. McDonough,
(REGULATION H) principal to those activities that are Deputy Secretary of the Board.
permissible for national banks—in each [FR Doc. 2025–23548 Filed 12–19–25; 8:45 am]
■ 1. The authority citation for part 208
case, subject to the terms, conditions,
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continues to read as follows: BILLING CODE 6210–01–P
and limitations placed on national
14 5 U.S.C. 553(b)(4)(A). banks with respect to the activity—
15 See 5 U.S.C. 601(2). unless those activities are permissible
16 44 U.S.C. 3501 et seq. for insured State-chartered banks under
17 12 U.S.C. 4809. section 24 of the Federal Deposit
18 See 5 U.S.C. 553(d)(2). Insurance Act.
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