Forecast: Fed to Revisit Regulation O and Merger Rules

March 31, 2026

Speaking to the Consumer Bankers Association’s annual conference, Fed Vice Chair Michelle Bowman announced the Fed will revisit Regulation O, which governs loans to bank insiders. The decades-old rule caps lending to executive officers at $100,000 per person—a threshold that has not kept pace with inflation. Banks have called for raising the limit to $1 million and indexing it. Bowman confirmed the rule is “ripe for review.” 

At the American Bankers Association Summit, Bowman said regulators are examining competition metrics used to evaluate bank mergers, including the Herfindahl-Hirschman Index (HHI). She indicated the Fed is working on an HHI proposal to address “unintended outcomes” for community banks. Bowman also said merger review timelines have “gotten out of hand” and the Fed is working to meet statutory deadlines.

Source: https://www.federalreserve.gov/newsevents/speech/bowman20260331a.htm

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