According to recent reports in the press, the Obama administration is proposing to change the structure of fees that banks pay to their respective federal supervisory agencies. It has been reported that the new approach will involve a two-tiered, pay-for-regulation concept, whereby banks with more than $10 billion in assets would see increases in fees from their existing regulators and the new consumer protection agency that has been proposed by the Administration.

According to the Washington Post, Michael Barr, Assistant Treasury Secretary for Financial Institutions, stated, “We think the funding mechanism makes sense, though I understand not everyone in the industry is going to like it. The fee assessment is based on the risks and costs of supervision. The larger institutions require greater oversight, and in terms of consumers, they are reaching many, many more with more complicated products.”