In an October 6 speech, the Federal Reserve’s Vice Chair for Supervision, Michelle Bowman, described a restructuring of the agency’s supervision function. The supervision function is currently organized according to the twelve Reserve Bank districts, which do not always follow state lines. The restructuring features a five-region system following state lines, with regional leaders responsible for the supervisory activities in their respective regions. The plan is informed by the Conference of State Bank Supervisors’ five-region system. Bowman explained that the new structure is in part driven by a recent report on the failure of Silicon Valley Bank that had identified structural issues in the agency’s supervisory function, including a separation of supervisory responsibility by Vice Chair of Supervision and its performance by the Reserve Banks. She said that the new structure is expected to simplify leadership, facilitate scale, and support more effective and efficient coordination between the Federal Reserve and other regulators. She did not specify the composition of the five new regions, implementation timelines, or how the new structure will interact with existing Reserve Bank districts, which will continue to exercise supervisory functions.
