WASHINGTON—Banks would be prohibited from refusing to lend or provide other services to entire categories of lawful businesses under a rule a top bank regulator completed Thursday, his last day before stepping down.
The regulator, Brian Brooks, was responding in part to complaints from the oil-and-gas industry that it had been unfairly denied financing by large lenders. Completed just 10 days after its formal comment period ended—unusually quickly in the slow world of federal rule writing—the measure from the Office of the Comptroller of the Currency may be challenged by banks, which say it micromanages credit decisions.
The Biden administration may also seek to overturn the rule using a legislative tool known as the Congressional Review Act.
Mr. Brooks, who is stepping down as acting Comptroller of the Currency later Thursday in the final days of the Trump administration, said in an interview that the rule revolves around the same concept of nondiscrimination requirements in lending. Banks can still deny services to individuals or businesses, but they must justify their decisions quantitatively and objectively, he said.
“This is just a nondiscrimination principle,” he said. “If you’re not going to serve somebody for a service that you have chosen to offer to others…then you have to do the homework and show why this person is risky.”