Less Opacity in Bank Oversight, Says Fed's Bowman
Federal Reserve Governor Michelle Bowman has called for greater transparency in bank oversight, arguing that the current approach is outdated and fails to adequately serve the financial system.
Bowman highlighted concerns in several areas:
* Supervision: She questioned whether current supervision has prioritized non-core and non-financial risks over core financial risks.
* Bank Applications: Bowman advocated for a specialized resource to assist reserve banks in evaluating new bank applications and identifying viable approval pathways.
* Regulations: She urged regulators to reassess the entire bank regulatory system, eliminating inefficiencies and outdated provisions.
Bowman emphasized the importance of clear and timely feedback to banks, advocating against the use of inaction and opacity as supervisory tools.
Regarding monetary policy, Bowman expressed satisfaction with the current stance but acknowledged upside risks. She advocated for a cautious and gradual approach, citing concerns about slower-than-desired progress in disinflation and the potential impact of higher equity prices on financial conditions.