Fed Governor Bowman highlights her 2024 “New Year’s resolutions” for banking policymakers

Bank Regulatory Federal Issues Federal Reserve Climate-Related Financial Risks

On January 8, member of the Federal Reserve Board of Governors Michelle W. Bowman delivered a speech at a community bankers conference on the banking regulatory highlights of 2023, as well as three “New Year’s resolutions” that she would like to see policy makers implement in 2024. The speech first covered highlights of this past year’s banking regulatory environment, including the changes in the federal funds rate, the risk of inflation among food and energy markets, the Basel III Endgame requirements, and new guidance on third-party risk management practices.

Governor Bowman also highlighted her list of three New Years Resolutions, including (i) prioritizing banking safety and soundness; (ii) a renewed commitment to tailoring the prudential regulatory framework to the size of the institution; and (iii) increasing transparency in supervisory expectations. Bowman also focused on the new climate guidance, as covered by InfoBytes here, which she posits a lost focus by the federal banking agencies. Bowman closed by commenting on the lasting impact of changes to the banking system and bank regulatory framework, requesting that bankers and other interested stakeholders to share their views and concerns broadly, including to regulators, and expressing her hope that policymakers have the humility and courage to acknowledge consequences and change course as needed.