The OCC requires a national bank to review securities. Which securities should it review?

The requirement for a national bank to review securities it holds is specifically focused on those for which it exercises investment discretion in individual accounts. This is crucial because when a bank has discretionary investment authority, it must ensure that the investments align with the account holder’s goals and risk tolerance. Regular reviews of these securities allow the bank to monitor performance, assess risk, and make necessary adjustments based on market conditions or changes in the client’s circumstances.

This practice promotes responsible stewardship of the assets under management, enhances compliance with fiduciary obligations, and helps mitigate potential legal risks associated with imprudent investment decisions. By scrutinizing each individual account where discretion is exercised, the bank can maintain the integrity of its investment strategy and uphold its duty to act in the best interest of its clients.