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TODAY'S BRIEFING The 21st Century ROAD to Housing Act became law overnight. The signing window closed at midnight Friday without a presidential veto, and the measure took effect without the President's signature — making its banking provisions operative for the first time. For community lenders, the package delivers three concrete wins that had been staged but not activated: a custodial-deposit carve-out for banks under $10 billion, modified reciprocal-deposit treatment, and a $6 billion asset threshold for the extended 18-month examination cycle. The enactment lands the same day Treasury opened a fresh front in its Iran financial-pressure campaign and the OCC closed the smallest bank in the country. | ▸ | Reciprocal and custodial deposits now live: The reciprocal-deposit provision widens the ability of banks under $10 billion to compete for large corporate and municipal balances long dominated by bigger institutions, and the custodial-deposit carve-out changes how those balances are classified. Deposit-operations teams can now book against the exceptions rather than stage policies for them. |
| ▸ | Exam-cycle relief: Institutions up to $6 billion in assets qualify for the extended 18-month examination cycle, lowering recurring supervisory burden for a broad swath of community and regional banks. |
| ▸ | The competitive read: Community banks gain a durable footing in institutional deposit-gathering just as tokenized-deposit and stablecoin rails begin competing for the same corporate treasury balances — a market where scale has favored the largest banks. |
· · · REGULATORY DEVELOPMENTS Treasury sharpened its Iran sanctions perimeter while the OCC demonstrated that prompt-corrective-action still has teeth at the smallest end of the industry. | ▸ | OFAC targets a Supreme Leader financier: On July 10 Treasury's Office of Foreign Assets Control designated Ali Ansari, a Dubai-based financier accused of embezzling billions from Iran's dissolved Ayandeh Bank on behalf of Mojtaba Khamenei; his holding company Smart Global Limited; and three Iranian exchange houses — the Darbani, Lavasani, and Khandan partnerships — that move foreign currency for more than a dozen sanctioned Iranian banks including Bank Melli and Bank Saderat. The action invokes Executive Orders 13902, 13876, and 13224, creating blocking obligations within 10 business days. Correspondent-banking, trade-finance, and payments desks with exposure to counterparties in Germany, Luxembourg, Spain, the UK, Cyprus, or the UAE should reconcile the identified shell structures against open relationships. |
| ▸ | Smallest US bank fails: The OCC closed Kentland Federal Savings and Loan Association of Kentland, Indiana on July 10 and named the FDIC receiver, citing unsafe and unsound practices, capital depletion, and no reasonable prospect of recovery. With $3.73 million in assets, it was the smallest standalone bank in the country. Kentland Bank, an unaffiliated institution, assumed all $3.65 million in deposits, and the branch reopens Monday, July 13; the FDIC estimates a $1.2 million cost to the Deposit Insurance Fund. The signal for community boards is that prompt corrective action applies uniformly regardless of institution size. |
| ▸ | Municipal advisor FAQ update: The SEC's Office of Municipal Securities revised its registration guidance effective July 10, clarifying that public-private-partnership advisory activity can trigger registration, that remote work locations conducting municipal advisory business must be disclosed as "offices" on Forms MA and MA-I, and the recordkeeping scope for pricing advice. Banks with municipal advisory units should confirm registration status. |
· · · POLITICAL & LEGISLATIVE Congress turns to consumer-finance oversight and Fed accountability in the week ahead. | ▸ | First Trump-era CFPB testimony: House and Senate committees will hold hearings on the Bureau's semi-annual report the week of July 15, with the House Financial Services Committee convening at 10 a.m. on July 15. These mark the first appearances by Acting Director Russell Vought's Bureau before Congress, and will be the clearest read yet on which inherited rules — the credit card late-fee regulation among them — the Bureau intends to reopen. |
| ▸ | Monetary Policy Report ahead of Warsh: The Federal Reserve released its latest Monetary Policy Report on Friday, citing tariff-driven inflation pressure, ahead of Chair Kevin Warsh's July 15 testimony. It is the fullest look yet at how the reshaped committee frames the inflation path. |
| ▸ | Custodia presses the Fed on master accounts: Custodia Bank asked the Supreme Court to review the Fed's denial of its master account, keeping alive a challenge to the central bank's discretion over payment-system access — a question with direct stakes for uninsured and novel-charter applicants seeking Fed connectivity. |
· · · INDUSTRY SIGNALS | ▸ | UK puts cloud giants under direct regulatory oversight. The UK government placed Amazon, Google, Microsoft, and Oracle under direct supervision by the Financial Conduct Authority and Prudential Regulation Authority, shifting cloud-concentration risk from bank-managed vendor oversight to direct regulator supervision of critical infrastructure providers. US regulators have not adopted the model, but banks running business-critical functions on these platforms should inventory dependencies now; a comparable US framework would land as enhanced vendor-audit and regulatory-access obligations. |
| ▸ | More banks fence off prediction markets. JPMorgan Chase, Morgan Stanley, and Bank of America are following Goldman Sachs in restricting employee trading on platforms such as Kalshi and Polymarket, barring wagers on financial and political events. The moves track SEC insider-trading charges against a Google employee and an Army soldier for suspicious prediction-market bets — the concern being staff monetizing employment-derived nonpublic information. Event-contract activity now belongs inside personal-conduct and market-integrity policies. |
| ▸ | Stablecoin charter momentum continues. Circle's final OCC national trust charter, approved Friday, sent CRCL up double digits and extended the supervised-issuer template that competitors including Sony Bank's Connectia Trust are being pushed toward. Separately, Nubank secured authorization to operate as a bank in Mexico, where it already counts roughly 15% of adults as customers. |
· · · WHAT'S COMING | ▸ | Fed notices — expected July 13: Federal Register publication of bank holding company formation and nonbanking-activity notices, plus the annual civil monetary penalty inflation adjustment — the latter worth a compliance calendar note for penalty-exposure modeling. |
| ▸ | MIAX rule change — expected July 13: A Miami International Securities Exchange proposed amendment to Rule 612 (Aggregate Risk Manager) reaches the Federal Register; options market-making desks should track the Origin Multiplier methodology. |
| ▸ | Bank earnings open July 14: JPMorgan leads a week packing several major banks into the reporting calendar. Net interest income trajectory and any tariff-linked reserve build on commercial and small-business books are the numbers to watch. |
· · · WHAT IT MEANS | ▸ | Housing Act relief is now operative: The custodial and reciprocal-deposit exceptions can lower funding costs for banks under $10 billion, and the $6 billion exam-cycle threshold reduces supervisory burden. Institutions that staged acceptance policies should activate them and confirm classification treatment with their examiners. |
| ▸ | Iran sanctions exposure check: Banks with correspondent, trade-finance, or payments relationships touching the designated exchange houses or the identified European and Gulf real-estate structures should complete blocking and relationship reviews within the 10-business-day window. |
| ▸ | Cloud concentration is a live supervisory trajectory: The UK's direct-oversight model is a leading indicator for US action. Banks should treat a comprehensive cloud-dependency inventory as foundational third-party-risk work rather than waiting for a domestic rule. |
DATES THAT MATTER | ▸ | Jul 13 (2d) — Comments close: Regulation for Federal Financial Assistance [NCUA] | | ▸ | Jul 16 (5d) — Effective: Records Preservation Program and Appendices-Record Retention Guidelines; Catastrophic Act Preparedness Guideli [NCUA] | | ▸ | Jul 17 (6d) — Comments close: Implementing the Guiding and Establishing National Innovation for U.S. Stablecoins Act for the Issuance of Sta [NCUA] | | ▸ | Jul 21 (10d) — Effective: Equal Credit Opportunity Act (Regulation B) [CFPB] | | ▸ | Jul 24 (13d) — Comments close: Permitted Payment Stablecoin Issuer Anti-Money Laundering/Countering the Financing of Terrorism and Sanctions [OCC] | | ▸ | Jul 27 (16d) — Comments close: Definition of Huione Group, a Financial Institution Operating Outside the United States of Primary Money Laund [FinCEN] | | ▸ | Jul 27 (16d) — Comments close: Regulation A: Extensions of Credit by Federal Reserve Banks [FRB] | | ▸ | Jul 27 (16d) — Comments close: Regulation D: Reserve Requirements of Depository Institutions [FRB] |
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