OCC GENIUS Act final rule: what bank issuers must do

The OCC GENIUS Act final rule was announced on October 21, 2026, eight months after the proposal and after roughly 328 public comments. It is the first final regulation under the Guiding and Establishing National Innovation for U.S. Stablecoins Act, and it becomes effective on January 18, 2027, the same day the Act itself takes effect. The OCC's announcement was accompanied by three bulletins: the rule itself, guidance on waivers and applications, and revised reporting forms.

The rule creates a new 12 CFR Part 15. It applies to national banks, federal savings associations and federal branches and their subsidiaries, to nonbank federal qualified issuers, to state qualified issuers under OCC authority and to foreign issuers, and it governs certain custody activities of OCC-supervised entities even when they never issue a stablecoin. Bank Secrecy Act, anti-money laundering and sanctions requirements are deliberately absent; the OCC will address them in a separate rulemaking with the Treasury Department. This article is written for a bank weighing a stablecoin subsidiary and for the officers who will operate one.

Reserves, redemption and risk management

Reserves (§ 15.11). Reserve assets must be identifiable, segregated from the issuer's other assets, held directly or at an eligible financial institution, and at all times equal to or greater than the outstanding issuance value. The issuer must show it can monetize them to meet redemptions in normal and adverse conditions, keep a buffer where needed, and withdraw any excess only after confirming the reserve stays above the outstanding amount. Eligible assets follow the statute: U.S. currency and Federal Reserve Bank balances, demand deposits at insured depository institutions, Treasury securities with 93 days or less to maturity, overnight Treasury-backed repurchase agreements, government money market funds, and similar federal assets the OCC approves.

Redemption (§ 15.12). The issuer must publish a redemption policy that states the timeframe for redemption, how a holder redeems, any minimum, and the scenarios in which the period may be extended. Timely redemption may not exceed two business days from the request, and the issuer must redeem any amount of one stablecoin or more. Discretionary limits on redemption can be imposed only by the OCC, or by the state regulator of a state qualified issuer, not by the issuer itself.

Risk management (§ 15.13). The standards scale with size and complexity but are specific: clear lines of authority with segregation of duties and dual controls, timely regulatory reporting, procedures to safeguard and monetize reserves, an internal audit function (or independent reviews for a small issuer) that verifies published information and reserve calculations and reports to the board, and management of interest rate risk.

Custody, supervision and capital

Custody (§§ 15.20 to 15.23). A covered custodian must record and account for a customer's covered assets separately, treat them as the customer's property and protect them from the custodian's creditors. It must maintain possession or control, including control of the private keys of any wallet it holds directly, and may use a sub-custodian only with safeguards that let it oversee the sub-custodian's compliance. The test for control is worth memorizing: the custodian has control if it can show that no other party, including the customer, can transfer the asset without its consent. Omnibus accounts are permitted if recordkeeping is adequate and the custody agreement discloses them. A bank that only supplies self-custody hardware or software, without controlling keys, is outside this subpart.

Supervision and reporting (§ 15.14). The OCC will examine each issuer at least once every 12 months, or every 18 to 24 months for a compliant issuer with less than $1 billion outstanding. Issuers file a confidential weekly report of activity and reserves and a quarterly report of condition and income. Subject to approval of the forms by the Office of Management and Budget, the revised forms begin with the January 25, 2027 weekly report date and the March 31, 2027 quarterly report date.

Capital and operational backstop (§§ 15.40 to 15.42). A new issuer holds the greater of its licensing condition or $5 million for 36 months. Every issuer keeps capital commensurate with its risks, never below $5 million, plus assets equal to 12 months of total expenses as an operational backstop. The OCC may impose an individual add-on.

The application path and the waiver

An insured national bank that wants to issue through a subsidiary files an application under § 15.30 and must receive prior approval before the subsidiary issues anything. The OCC tells the applicant within 30 days whether the application is substantially complete, and again within 30 days of any additional information. The application bulletin adds that a file still incomplete after that exchange is returned within 60 days of the first notice, and that the agency aims to act on complete applications within 120 days, which is the statutory period after which an application is deemed approved.

Two timing points matter for planning. The OCC will not accept applications until the Office of Management and Budget approves the application forms, and it will announce that date in a separate release. And the waiver under section 5(f) of the Act is narrow: it is available to an issuer already operating in the United States whose substantially complete application is pending on January 18, 2027, for no more than 12 months from that date. A prospective issuer not yet operating is expected to wait for approval. The application topics the OCC lists are the documents a bank should already be drafting: business plan and management, reserves, issuance and redemption, risk management, capital and liquidity, financial crime compliance, third-party risk and audit. Our guide to permitted issuer status explains the three routes into that process.

What changed from the proposal

• The yield presumption is gone. The statute's ban on paying holders interest or yield stays, with the OCC's authority to prevent evasion. The proposal's rebuttable presumption that certain arrangements with affiliates and related third parties violated the ban was eliminated after comment; such arrangements will be assessed on their facts.
• Repurchase agreements are approved by rule rather than case by case, within the statute's overnight, Treasury-backed limits.
• Capital is simpler. The backstop concept survived; the calculation was reduced.
• Tokenized reserves are defined. A reserve asset in tokenized form qualifies only if the ledger is the authoritative record and the holder's rights match the conventional asset.

For a design built on just-in-time supply, the rule reads comfortably. When tokens are created only after funds are confirmed and retired at redemption, outstanding issuance equals confirmed backing at every moment, which is what § 15.11 requires the issuer to demonstrate and what the weekly report asks for. Our Regulated Money Platform was built on that principle, with the bank's own key required for every mint, freeze and burn, which is also the rule's test for custody control.

What a bank should do before January 18

1. Reconfirm the instrument. The Act excludes deposits recorded on a ledger from the definition of a payment stablecoin, so a bank whose use case is cash management among its own customers may not need a subsidiary at all.
2. Map your draft policies to Part 15. Reserve policy to § 15.11, redemption policy to § 15.12, control framework and audit charter to § 15.13, custody agreements to § 15.21.
3. Size the capital. $5 million of minimum capital plus 12 months of expenses is the floor, before any individual requirement.
4. Watch two releases. The OCC's notice that it is accepting applications, and the separate financial crime rulemaking with the Treasury.
5. Track the other agencies. The FDIC and the Federal Reserve rules for their issuers remain proposals; the Federal Reserve's comment period closes November 30, 2026. Our bank-by-regulator guide keeps the dockets in one place, and the board checklist for January 2027 covers the decisions above the policy level.

To work through the rule against your own charter and application file, schedule a session with us.

Frequently asked questions

When does the OCC GENIUS Act final rule take effect?

On January 18, 2027, the same day the GENIUS Act becomes effective. The rule was announced on October 21, 2026 with OCC Bulletin 2026-50. The reporting forms that accompany it are subject to approval by the Office of Management and Budget and are scheduled to start with the January 25, 2027 weekly report and the March 31, 2027 quarterly report.

How quickly must a stablecoin be redeemed under the OCC rule?

Section 15.12 requires a public redemption policy and states that timely redemption may not exceed two business days following the date of the request. The issuer must redeem any amount of one stablecoin or more, subject to customer screening and onboarding, and only the OCC, or the state regulator of a state qualified issuer, may impose discretionary limits on redemption.

How much capital does a bank stablecoin subsidiary need?

A new issuer must hold the greater of the amount set in its licensing conditions or $5 million for 36 months. Every issuer must maintain capital commensurate with its risks and never less than $5 million, and must hold assets equal to 12 months of total expenses as an operational backstop. The OCC may impose an individual additional requirement on a specific issuer.

Does the final rule cover anti-money laundering requirements?

No. The OCC excluded Bank Secrecy Act, anti-money laundering and sanctions requirements from this rule and will address them in a separate rulemaking coordinated with the Treasury Department. Until that rule is final, a bank should build the subsidiary's financial crime program against the OCC's June 2026 proposal and the joint FinCEN and OFAC proposal of April 2026.

Can a bank apply for the stablecoin subsidiary now?

Not yet. The OCC will begin accepting applications and waiver requests only after the Office of Management and Budget approves the application forms, and it will announce the start date in a press release. Banks can prepare the file now: business plan, reserve and redemption policies, risk management, capital and liquidity, financial crime compliance, third-party risk and audit.

This article is general information, not legal advice. Section references are to the final rule as released on October 21, 2026; consult the Federal Register text and your counsel before relying on any requirement.