Fed to reorganize bank supervision into five regions

Federal Reserve Vice Chair for Supervision Michelle Bowman announced a plan to reorganize the central bank’s bank-supervision operation into five geographic regions, each led by an official accountable for supervisory activity in that area. Existing Federal Reserve Bank staff will continue examining the banks they already oversee, while the new regions will follow state lines rather than the boundaries of the Fed’s 12 Reserve Bank districts. Bowman said the structure is intended to make decision-making clearer, reduce delays and strengthen accountability. She described the current system as one in which responsibility for supervisory decisions could be obscured by overlapping authority and a complex network of committees. The Fed will streamline or remove committee processes that Bowman said had impeded prompt action on identified risks. The announcement follows an independent review of the failure of Silicon Valley Bank. Bowman said the review identified a longstanding mismatch between decision-making authority and accountability in the Fed’s supervisory function. Her account of the review also linked the existing structure to delays in taking action.