Bowman Says More Fed Regulatory, Supervisory Changes Coming Soon
By CU Today Staff —
WASHINGTON—Federal Reserve Vice Chair for Supervision Michelle Bowman said additional changes to the central bank's supervisory and regulatory framework are imminent, including a reorganization of the Fed's Supervision and Regulation Division and the hiring of new leadership to implement a more risk-focused approach to bank oversight.
Speaking Thursday at the Massachusetts Bankers Association's Executive Officers Conference, Bowman said the Federal Reserve has finalized a new organizational structure and will soon begin recruiting for key supervisory positions, according to American Banker.
"Our job is not to save a failing bank," Bowman said, according to American Banker. "Our job is to ensure ... that we're helping them identify what the problems are and allowing them to address them through that supervision process."
She said the revamped organization will place greater emphasis on identifying financial risks that could threaten a bank's safety and soundness rather than focusing on procedural or documentation deficiencies. American Banker reported the restructuring follows the retirement of longtime Supervision and Regulation Director Michael Gibson and is intended to modernize the Fed's supervisory approach.
Bowman's comments build on testimony she delivered before the House Financial Services Committee earlier this month, in which she said the Federal Reserve has already made "substantial progress" in modernizing supervision and regulation. According to her prepared testimony, the Fed has begun implementing reforms to improve transparency, tailor supervision to actual risk, revise stress testing, reconsider capital requirements and ensure examiners focus on issues that pose material financial risk to institutions rather than technical compliance matters.
Originally reported by CU Today.