Davis Polk partner and Financial Institutions head Margaret Tahyar and AML/CFT head Dan Stipano were quoted in Law360 discussing regulatory issues for banks to watch in 2026.

The article noted that the Federal Reserve, FDIC and OCC are positioned for seismic shifts in how they supervise the banking industry. Margaret said that what comes next “is the hardest part, and that’s actual implementation.”

Noting that progress may be harder for outsiders to judge, given that supervision plays out behind closed doors, she said that she “is hopeful the agencies will begin releasing more aggregated, anonymized data to show how supervisory outcomes are changing over time, rather than leaving the public to infer success or failure only when a crisis erupts.”

Additional “responsible transparency” could give the industry, Congress and the broader public a clearer picture of what’s working, she added.

The piece also stated that the Federal Reserve’s Vice Chair for Supervision Michelle Bowman has said they are reviewing their CAMELS ratings regime, the system banking agencies use to rate banks.

“CAMELS have not been revised since 1996 — a long time ago when you think about changes to the banking sector,” Margaret said. “I expect the changes to reweight more towards financial risks and to give less weight to management.”

Discussing potential changes to the U.S. anti-money laundering regime, Dan noted, “We’re at a moment where there is a real likelihood of BSA [Bank Secrecy Act] reform. The stars have never really aligned like they have right now, where there is quite a bit of congruence between what the industry wants and what senior officials in the administration want.”

“[Banks can have] very strong financial intelligence units, do thorough investigations, and provide lots of good information that leads to prosecutions and convictions, but they’re not really rewarded for that by regulators,” Dan said of the current system. “Effectiveness is being measured based on technical compliance with rules as opposed to actual outcomes.”

“Banking Regulation To Watch In 2026,” Law360 (January 2, 2026) (subscription required)

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