Fed Plans Five-Region Bank Oversight Structure, Will Review Thresholds

The Federal Reserve plans to reorganize bank supervision into five geographic regions, clarifying the Washington headquarters’ responsibility for the system and assigning a regional leader to each area.

Fed Vice Chair for Supervision Michelle Bowman outlined the plan Oct. 6 in prepared remarks for a Federal Reserve Bank of St. Louis meeting. Under the proposed structure, the five regional leaders would oversee supervisory activity across their respective areas, while staff at regional Fed banks would conduct examinations.

Bowman said the current structure weakens the connection between responsibility and accountability. She described the restructuring as an effort to build a culture that emphasizes accountability and clear decision-making authority.

The Fed also plans to consider adjusting the asset-size thresholds that determine when banks face stricter supervisory requirements later this year.