The Federal Reserve Is Changing Its Bank Supervision System

The US Federal Reserve is transitioning to a new bank supervision system. Following the change, responsibility for decisions will be more clearly distributed, with Washington serving as the main hub of oversight.

Five geographic regions will be created for supervision. Each will have its own head, who will be responsible for all examinations and related decisions within their region. The work will still be carried out by staff from the Federal Reserve's regional banks. Selection of the regional heads will begin early next year.

According to Federal Reserve Vice Chair Michelle Bowman, the old system was overly complicated: many committees were involved in decision-making, which slowed down the process and often left it unclear who was ultimately responsible. Part of the changes is based on the findings of an internal investigation conducted after the collapse of Silicon Valley Bank.

Source: Reuters