Fed supervision changes: winners and losers

Author: John Crabb | Published: 21 Nov 2018

The Federal Reserve’s recent proposals that outline possible changes to the way it keeps the financial system strong and robust have been welcomed by the industry, but some financial institutions will be happier than others.

Foreign banks have yet to be offered any relief, nor have those that remain in certain new threshold categories that are set to be created, such as the largest national banks. Small and community banks, meanwhile, are set for significant regulatory respite.

Spearheaded by vice chairman for supervision Randal Quarles in speeches and testimonies over the last month, the Fed has made a number of suggestions to the way that stress testing works in the US, including amendments to stress capital buffers and transparency, as well as the prudential standards that govern how smaller banks operate in the country.

Briget Polichene, chief executive officer of the Institute of International Bankers (IIB), told IFLR that...