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OCC BULLETIN 2018-11
To: Chief Executive Officers and Compliance Officers of National Banks, Federal Savings Associations, and Federal Branches and Agencies; Department and Division Heads; All Examining Personnel; and Other Interested Parties

Description: New Comptroller's Handbook Booklet and Rescissions

Summary

The Office of the Comptroller of the Currency (OCC) issued today the “Military Lending Act” booklet of the Comptroller’s Handbook. This new booklet, part of the Consumer Compliance series of the Comptroller’s Handbook, is for use by OCC examiners when assessing compliance with the Military Lending Act (MLA), as implemented by 32 CFR 232, “Limitations on Terms of Consumer Credit Extended to Service Members and Dependents.” The MLA applies to closed-end and most open-end consumer credit consummated or established on or after October 3, 2016, and to credit card accounts established on or after October 3, 2017, that are covered by the MLA and 32 CFR 232.

The booklet reflects U.S. Department of Defense amendments to 32 CFR 232 as published in the Federal Register on July 22, 2015,1 and related official Defense Department interpretations (interpretive rule) as published in the Federal Register on August 23, 2016,2 and December 14, 2017,3 respectively.

Rescissions

The “Military Lending Act” booklet replaces and rescinds the “Limitations on Terms of Consumer Credit Extended to Servicemembers and Dependents” procedures that were found in the “Other Consumer Protection Laws and Regulations” booklet of the Comptroller’s Handbook.

The “Military Lending Act” booklet incorporates the interagency MLA examination procedures developed by the Federal Financial Institutions Examination Council’s Task Force on Consumer Compliance (2016 interagency MLA examination procedures) and rescinds OCC Bulletin 2016-33, “Military Lending Act: Revised Interagency Examination Procedures Regarding Limitations on Terms of Consumer Credit Extended to Service Members and Dependents.” Bulletin 2016-33 accompanied the 2016 interagency MLA examination procedures.

Note for Community Banks

This booklet applies to the examinations of OCC-supervised institutions that consummate or establish consumer credit products covered by the MLA and 32 CFR 232 as of October 3, 2016.

Highlights

  • The booklet incorporates the 2016 interagency MLA examination procedures under the Comptroller’s Handbook template for OCC examiners.4
  • Consistent with the July 2015 regulatory amendments, the booklet reflects
    • the expansion of MLA protections to a broader range of consumer credit products.
    • rules for determining the fees and charges that are included within the calculation of the military annual percentage rate (MAPR) and for calculating the MAPR.
    • the optional safe harbor methods available to creditors for identifying covered service members and dependents (covered borrowers).
    • disclosures that creditors are required to provide to covered borrowers.
    • limitations on consumer credit extended to covered borrowers.
  • These amended regulatory requirements went into effect on October 3, 2016, for consumer credit products other than credit cards.
  • The requirements relating to credit card accounts became effective October 3, 2017.

Further Information

Contact Paul R. Reymann, Director for Consumer Compliance Policy, at (202) 649-5470.

 

Donna M. Murphy
Deputy Comptroller for Compliance Risk Policy

Related Link

1 80 Fed. Reg. 43560.

2 81 Fed. Reg. 58840.

3 82 Fed. Reg. 58739.

4 The “Military Lending Act” booklet incorporates the content of the 2016 interagency MLA examination procedures but appears in the OCC’s Comptroller’s Handbook template.