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The Federal Reserve has broad supervisory and regulatory authority over state-chartered banks and bank holding companies, as well as foreign banks operating in the United States.
In recent days, German diplomats made clear in Brussels that they had some reservations about giving the central bank such broad supervisory powers.
They frequently recur in our history 2 and insofar as they take place in federal courts we have broad supervisory powers over them.
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Nevertheless, it is clear from the significant progress and investment made over the years that resolution planning is and will remain a key part of the broader supervisory framework.
During the recent (and still ongoing) financial crisis, answers to this question using standard approaches, e.g., regulatory capital ratios, were no longer credible, and thus broad-based supervisory stress testing became the new tool.
After the crisis, there was a broad increase in supervisory expectations for these boards.
Mr. Dudley said there were "legitimate questions as to how broad the Federal Reserve's regulatory and supervisory responsibilities should be".
Individual bank-based supervisory action instead of broad "one size fits all" exposure limits would have the additional benefit of allowing for individual exceptions or transition periods.
Although the Dodd-Frank Act required the Federal Reserve and federal banking agencies to take certain actions (e.g., establish enhanced prudential standards), the federal banking agencies have broad authority to establish prudential and supervisory requirements for banking organizations separate from the Dodd-Frank Act.
Although possibly the emphasis was on the psychosocial intervention, rather than the broader CC framework; but lack of time, concerns over supervisory arrangements in routine practice and perceived cost of implementation were identified by all participants as barriers to this.
Broad coverage: All banks in the eurozone will be covered by the new European supervisory system.
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Justyna Jupowicz-Kozak
CEO of Professional Science Editing for Scientists @ prosciediting.com