Fed official hints at more measures to prevent bank failures
Collapse of two major banks, Silicon Valley Bank and Signature Bank, in quick succession has rattled global banking systems
A top Fed Reserve official has called for more regulatory efforts to match fintech innovations amid growing strain on the US banking system hit by the collapse of two key banks.
“Along with presenting new opportunities, innovation can introduce new risks and create new vulnerabilities,” said Governor Michelle W. Bowman in an address to the Independent Community Bankers of America (ICBA) Conference, Honolulu, Hawaii.
“Banks, and really, any business today that adopts new technologies must be prepared to make corresponding improvements to manage these risks and vulnerabilities, including improvements to risk management, cybersecurity, and consumer compliance,” Bowman said.
“Regulators must continue to promote efforts that are consistent with safe and sound banking practices and in compliance with applicable laws, including consumer protection laws,” the official added. “As I am sure you appreciate, this is not always an easy task, and the regulatory response to innovation must reflect the changes in how banks engage in this process.”
