OCC’s Semiannual Risk Perspective Highlights Key Risks in Federal Banking System
November 12, 2026 / Source: OCC
WASHINGTON—The Office of the Comptroller of the Currency (OCC) today reported the key issues facing the federal banking system in the Semiannual Risk Perspective for Fall 2026.
The OCC highlighted credit, market, compliance, and operational risks, as key risk themes in the report. Highlights from the report include:
- Interest rate developments could affect both the net interest margin (NIM) and the valuation of securities held by banks. Higher interest rates could also increase commercial refinancing risk.
- Credit risk in the loan portfolios of OCC-supervised banks remains modest overall.
- Banks of all sizes are continuing to explore ways to leverage Super Intelligence (SI). The growing availability and advancement of SI create opportunities to enhance efficiency and internal controls as well as to improve analytics and customize services.
- Employed by threat actors, advanced SI amplifies cybersecurity and fraud concerns.
The OCC reported that profitability for both the federal banking system and banks with assets less than $30 billion (community banks) increased to levels not seen in more than two decades during the first half of 2026. Loan growth, modest expansion of NIM and expansion of non-interest income contributed to robust revenue growth. Lower provisioning for credit losses further supported net income and profitability.
Since the release of the previous SARP, the OCC has continued to reset the OCC’s risk tolerance and enhance the risk-based nature of its supervisory policies and practices. Specific actions include the codification of unsafe or unsound practices and expanded eligibility for an 18-month exam cycle for community banks with up to $6 billion in assets. These and other changes aim to focus supervision on material financial risk and reduce exam burdens, especially for community banks.