Seven specific risks ahead for national bank regulators were outlined by the outgoing Federal Reserve’s top supervisor Thursday, as he also outlined his plans ahead.
Federal Reserve Board Vice Chair for Supervision Michael Barr said the seven specific risks are:
- maintaining and finishing post-financial crisis reforms;
- maintaining the credibility of the stress test;
- maintaining credible, consistent supervision;
- encouraging responsible innovation;
- addressing cyber and third-party risk;
- risks in the nonbank sector;
- climate risk.
Each will continue to be a risk in either the near- or long-term, Barr said. He made the remarks in an address at the Georgetown University Law Center in Washington, D.C.
Regarding his plans, Barr said he would remain a member of the Federal Reserve Board (his term on the Fed Board runs to 2032; he is now serving an unexpired term of 14 years that began Feb. 1, 2018).
In early January, Barr announced his plan to step down as top supervisor at the Fed, even though his term in that role runs to 2026.
In Thursday’s remarks, Barr said he has determined that he would be more effective “in serving the American people from my role as governor.”
“In this role, I’ll continue to participate in monetary policy deliberations and vote on matters before the Board, including those related to supervision and regulation,” Barr said.
Barr offered insight into his decision to step down as vice chair. He said he believed it was the right decision for the institution and, “more importantly, for the public, whom we serve.”
“The risk of a dispute over my position would be a distraction from our important mission,” he said. “I feel strongly—as (Federal Reserve Board Chair Jerome H. “Jay) Powell) has said publicly many times—that the independence of the Federal Reserve is critical to our ability to meet our statutory mandates and serve the American public. Put simply, our mission is too important to let such a dispute distract from doing our job for the American people.”
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