FED Board Member Michelle Bowman took a softer stance on cryptocurrencies in her latest statement.
FED Board Member Michelle Bowman made important assessments regarding banking supervision, capital adequacy regulations, and cryptocurrencies.
Bowman said that the first thing he did after taking office was to remove supervisory guidelines to prevent banks from discriminating against customers on the grounds of “reputational risk.”
“Banks can accept anyone engaged in lawful activities as a customer. There can be no discrimination based on business model, political views or any other reason,” Bowman said.
Bowman also commented on crypto assets, stating that the Fed has disbanded the “innovation oversight group” it established two years ago and transferred its oversight expertise directly to the review teams of regional Fed banks. Bowman stated that with regulations passed by Congress, digital assets will be able to operate within a legal framework both within and outside the banking system.
“I also want to encourage the industry to collaborate with regulators to help us understand the potential of blockchain and other solutions,” he said. “I am committed to changing our culture and attitudes around technology adoption and integration of new products and services.”
Speaking about capital regulations, Bowman stated that they have published a new proposal for a supplementary leverage ratio (SLR), which they aim to support, rather than restrict, banks’ ability to operate in the Treasury market. He also noted that the Basel III compliance process has been completed in other countries, and added that the US will also consider international standards when developing its own framework.
Bowman stated that changes will be made to the rating system of large banks, and that the four pillars of the capital adequacy framework, namely the stress capital buffer, the G-SIB additional liability, Basel III and leverage ratio regulations, will be addressed together.
Bowman also spoke about criticism of the multi-headed regulatory structure in the US, stating that the current system is necessary for national and state banks, and that any possible change is within the authority of Congress.
