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Fed vice chair says oversight will be tailored to community banks' size and risk
Summary
In closing remarks Vice Chair for Supervision Mickey Bowman told bankers the Fed intends to make supervision more proportionate to size, risk and business model, promised clearer application timelines and issued templates to support mutual bank capital options.
Vice Chair for Supervision Mickey Bowman closed the conference by emphasizing that supervision must be tailored to institution size, risk and complexity. Bowman said regulators should ask what problem each rule is solving and warned against one‑size‑fits‑all thresholds that unintentionally push small banks into heavier supervisory regimes.
Bowman said the Federal Reserve is working to increase transparency and reduce unnecessary burden, citing newly issued templates and frequently asked questions aimed at helping mutual banks raise capital. She urged regulators to clarify what information is needed for regulatory applications, set clear public standards and complete reviews within statutory time frames.
On supervisory practice, Bowman urged a shift toward focusing on material financial risk and away from procedure‑heavy examinations that can divert staff time and cost banks unnecessary resources. She said regulators are “doing so” and noted that the Fed is open to refining approaches after banks review the recently released mutual‑capital materials.
Bowman also encouraged indexation of asset thresholds as a simple policy to prevent banks from inadvertently crossing bright lines because of inflation or normal growth. She closed by reaffirming that the Fed’s supervisory role spans from the largest global institutions to single‑branch community banks and asked stakeholders to continue engaging as the agencies refine tailoring and transparency.
