OCC Report Identifies Key Risks Facing Federal Banking System — 2023-12-07

WASHINGTON—The Office of the Comptroller of the Currency (OCC) today reported the key issues facing the federal banking system in its Semiannual Risk Perspective for Fall 2023. The OCC reported that the overall strength of the federal banking system remains sound. The OCC expects banks to remain diligent and adhere to prudent risk management practices across all risk areas. Banks should continue to guard against complacency to ensure they maintain the ability to withstand potential future economic challenges. The OCC highlighted credit, market, operational, and compliance risks, as the key risk themes in the report. Highlights from the report include: Credit risk is increasing due to higher interest rates, increasing risk in commercial real estate lending, prolonged inflation, declining corporate profitability, and potential for slower economic growth. Key performance indicators are beginning to show signs of borrower stress across asset classes.