The three federal bank regulatory agencies on Wednesday issued an interim final rule raising the total asset threshold for eligibility for an 18-month on-site examination cycle from $3 billion to $6 billion, expanding the number of community banks that can be examined less frequently than once a year.
The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation and the Office of the Comptroller of the Currency released the rule jointly at 4:00 p.m. EDT on September 10, 2026.
According to the agencies, the higher threshold was set by the 21st Century ROAD to Housing Act, which increased the asset limit for certain supervised institutions to qualify for the extended cycle. The interim final rule incorporates that increase into the agencies’ regulations for well-rated institutions.
What the exam cycle governs
The on-site examination cycle sets how often supervisors conduct a full examination at an institution’s premises. For eligible small institutions, the cycle moves from 12 months to 18 months.
Eligibility is not automatic with size. The agencies said that by law, institutions must meet certain criteria to qualify for the extended cycle, including being considered well managed and well capitalized.
The agencies said the extended cycle applies to small banks with relatively low-risk profiles, and that they would continue the current supervisory practice of offsite monitoring between scheduled examinations.
In the agencies’ characterization, extending the cycle for what the release described as “small non-complex firms” from 12 months to 18 months “appropriately reduces burden, including time and resources spent, for these low-risk institutions.”
Foreign bank offices included
The rule also makes parallel changes to the agencies’ regulations governing the on-site examination cycle for U.S. branches and agencies of foreign banks, according to the release.
Timing and comments
The interim final rule takes effect immediately upon publication in the Federal Register, the agencies said, and comments will be accepted for 30 days. An interim final rule is issued in final form before the public comment period rather than after it.
The accompanying Federal Register notice is titled “Expanded Examination Cycle for Certain Small Insured Depository Institutions and U.S. Branches and Agencies of Foreign Banks.” The Federal Reserve also posted a board memo and a record of board votes.
The release did not state how many institutions fall between the $3 billion and $6 billion asset levels, or how many would newly qualify for the longer cycle.
Source: Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation and Office of the Comptroller of the Currency, joint press release, “Agencies reduce regulatory burden for community banks, increase eligibility for 18-month exam cycle,” released September 10, 2026. The rule is an interim final rule, effective upon publication in the Federal Register, with a 30-day comment period; the release does not quantify the number of affected institutions.