# Federal Reserve Board Proposes Regulation O Modernization

The Federal Reserve Board (FRB) has issued a proposal to modernize Regulation O, which governs the extension of credit to bank insiders including executives, board members, and major shareholders. This update aims to revise outdated dollar thresholds by indexing them to economic growth, clarify the regulation's application to passive investment interests, and maintain safeguards against preferential lending practices while supporting effective bank governance. Stakeholders have 60 days from the Federal Register publication date to submit comments on the proposal.

- **Why this matters:** Procurement professionals and contractors supporting financial regulatory compliance should note potential changes in supervisory requirements affecting banking institutions.
- The modernization may influence compliance service demands, particularly in risk management and regulatory advisory sectors.
- Organizations involved in financial services technology and consulting can anticipate evolving regulatory frameworks impacting client engagements.
- Engagement with the comment process offers an opportunity to influence final rule provisions relevant to credit extension practices within banks.

**Jurisdictions:** federal
**Industries:** Professional Services
**Topics:** Regulatory Compliance
**Published:** September 13, 2026

### Government Entities
- Federal Reserve Board (FRB)

### Key Quotes
> Today's proposal modernizes Regulation O by updating outdated dollar-based thresholds and ensuring their future relevance, while preserving necessary safeguards.
> — Michelle W. Bowman, Vice Chair for Supervision

### Sources
- [Federal Reserve Board - Federal Reserve Board requests comment on a proposal to modernize its rule governing the extension of credit to bank "insiders"—bank executives, board members and major shareholders who could potentially influence a bank's lending decisions](https://www.federalreserve.gov/newsevents/pressreleases/bcreg20260731b.htm) - Federal Reserve