DataVisuals · Decision Governance for Financial Institutions™ — for banks and credit unions Explore all products →

Removing the concept of reputation risk from supervisory materials is an operational directive, not an enforcement action. The governance failure lies upstream: examiners who pressured banks to terminate lawful customers based on reputational concerns were making discretionary decisions without producing contemporaneous records of the owner, the material-risk rationale, or the escalation path. Those missing decision artifacts—supervisor override logs, risk-assessment memos, approval chains—are what turned subjective judgment into unaccountable pressure. The policy reversal is welcome, but it leaves unaddressed the structural absence of decision records that would have made the original practice auditable and limited its misuse.

From the FDIC release

PRESS RELEASE | JUNE 2, 2026 Agencies Remove Additional References to Reputation Risk WASHINGTON—The federal bank regulatory agencies today jointly updated certain interagency documents to remove references to reputation risk. The agencies…

Read the original FDIC release →

The same decision-record gap exists in the calls no regulator ever sees. Score your institution →

← Back to all Watch items