The Trump transition team is considering major changes to the structure of federal bank regulatory agencies, including the Federal Deposit Insurance Corporation (FDIC). 

According to a report from the Wall Street Journal, the potential plans include merging the FDIC with other agencies or even eliminating it, proposals that would require congressional approval.

Interviews with nominees for leadership roles at agencies such as the FDIC and the Office of the Comptroller of the Currency (OCC) have included questions about consolidating deposit insurance into the Treasury Department, the sources said. 

These discussions reflect the Trump administration’s broader goal of streamlining government operations and reducing regulatory oversight in the financial sector.

Advisers have also explored merging the FDIC, OCC, and parts of the Federal Reserve with other financial regulators, as outlined in "Project 2025," a policy document created by the Heritage Foundation and former Trump officials. 

While President Trump has distanced himself from this document, some congressional allies, such as Rep. Andy Barr (R-Ky.), support similar proposals, including altering or eliminating the Consumer Financial Protection Bureau (CFPB).

Tesla CEO Elon Musk, who co-chairs Trump’s new Department of Government Efficiency (DOGE), has publicly criticized regulatory agencies, including the CFPB, as duplicative. Musk’s involvement in the advisory team adds a high-profile voice to the ongoing discussions about restructuring financial regulation.

Former FDIC Chair Sheila Bair noted that while streamlining financial regulations could reduce inefficiencies, eliminating a major agency like the FDIC would face significant resistance from both Congress and the banking industry. She emphasized that banks value their relationships with individual regulators and may prefer the status quo despite complaints about overlapping oversight.

The proposals come at a time when smaller banks are seeking wider deposit insurance protections to remain competitive. Any move perceived as undermining deposit insurance could trigger market instability, particularly after customer concerns about deposit safety led to significant shifts in the banking sector following last year’s failures.

Major changes to bank regulation are rare outside of financial crises and typically face bipartisan scrutiny. With slim Republican majorities in Congress, any drastic restructuring will likely face significant legislative hurdles.