Category Archives: Federal Reserve

What Should We Expect of Bank Directors? It Depends on Whom You Ask

By | March 21, 2018

Courtesy of Joseph A. Smith Jr. In August, the Board of Governors of the Federal Reserve (Fed) issued for comment a release entitled “Proposed Guidance on Supervisory Expectation for Boards of Directors” (Proposed Guidance).[1]  This note will briefly review the Proposed Guidance and the comments the Fed received on it.  I will focus primarily on… Read More »

Federal Reserve Consent Order Represents Worst Case Scenario for Wells Fargo Directors

By | February 6, 2018

Janet Yellen ended her tenure as Chair of the Federal Reserve with a bang last Friday when the Federal Reserve Board (the Board) voted 3-0 to issue a consent cease and desist order that imposes unprecedented sanctions on Wells Fargo for its phony-accounts scandal and other “widespread consumer abuses.” The primary sanction is a restriction… Read More »

Response to the Federal Reserve’s Proposal to Enhance the Effectiveness of Boards of Directors

By | August 29, 2017

Courtesy of Joseph A. Smith Jr. On August 3, 2017, the Board of Governors of the Federal Reserve System (“Federal Reserve”) released a proposal regarding its supervisory expectations for the boards of directors of bank holding companies, savings and loan holding companies, state member banks, U.S. branches and agencies of foreign banks, and non-bank systemically… Read More »

A Review of the Book “Fed Up”

By | April 28, 2017

To many, the Federal Reserve is a super-secretive organization, unaccountable to the public and endowed with extraordinary power to influence the world economy. To me, it was simply my workplace until last August. And just like any workplace, it has its own distinct rhythms and culture that manifest themselves in a variety of ways. This… Read More »

Increasing Transparency at the Financial Stability Board and Basel Committee

By | March 14, 2017

Shortly after President Trump took office, Congressman Patrick McHenry (R-NC) sent a sharply worded letter to Janet Yellen demanding that the Federal Reserve immediately cease participation in international financial regulation forums such as the Financial Stability Board (FSB), The Basel Committee on Banking and Supervision (BCBS), and the International Association of Insurance Supervisors (IAIS). McHenry… Read More »

New Legislation Designed to Make the U.S. a Fintech Leader

By | November 17, 2016

In his book Stress Test, former Treasury Secretary Tim Geithner vividly describes the difficulty he encountered in trying to get the various federal financial regulators to go along with the Obama administration’s post-crisis regulatory reform agenda.  In the summer of 2009, after the Treasury Department released the details of their proposal, regulators swarmed Capitol Hill… Read More »

Carmen Segarra and Competing Visions of Bank Supervision

By | October 25, 2016

The below are edited remarks from a speech I delivered at the Rethinking Regulation Seminar hosted by Duke University’s Kenan Institute for Ethics on October 25th, 2016. Today I will talk about an episode that occurred early in my tenure at the New York Fed.  And I tell this story not simply because it is… Read More »

Using Living Wills to Break up Big Banks

By | October 11, 2016

One of the key areas of focus during Wells Fargo CEO John Stumpf’s recent congressional testimony, was the timeline of events that led up to him becoming aware of the problems within the company’s community banking division.  Despite the fact that the firm fired over 1,000 employees in 2011 for opening unauthorized customer accounts, and… Read More »

If Banks Sue the Fed Over Stress Tests, Will They Win?

By | October 7, 2016

Last month, the Wall Street Journal published an article indicating several big banks were considering a legal challenge to the Federal Reserve’s annual stress testing exercise based on a violation of the Administrative Procedure Act (“APA”).  The article was short on details, and to those familiar with the APA –  the statutory scheme governing all… Read More »