Fed's Barr says regulators more aggressive with banks, focused on interest rate risk
Kudlow panelists Kevin OLeary, Kevin Hassett and John Carney discuss inflation, bank failures and credit card delinquencies.
The Federal Reserve's top supervisory official said Friday that bank regulators are flagging problems at banks at a higher rate over the past year and are conducting additional exams at firms facing large unrealized losses.
Federal Reserve Vice Chair for Supervision Michael Barr added that bank examiners are «closely focused» on how firms are managing commercial real estate risk as that sector faces post-pandemic pressure.
«The past year has been busy for Federal Reserve supervisors,» Barr said in prepared remarks nearly one year after the failure of Silicon Valley Bank due in part to large unrealized losses.
In the wake of SVB's failure and those of other large regional banks, including First Republic Bank and Signature Bank, the Fed has focused on quickly identifying bank issues.
REGIONAL BANK HIT WITH 3RD CREDIT DOWNGRADE AS CRISIS CONCERNS LINGER
The Fed's vice chair for supervision Michael Barr said that regulators are focused on monitoring potential issues facing U.S. banks. (Photographer: Graeme Sloan/Bloomberg via Getty Images / Getty Images)
Reuters reported in December that federal bank regulators had been stepping up their oversight of firms after last spring's bank failures and issuing disciplinary actions to firms – including downgrading confidential bank health ratings.
Barr said the uptick in activity isn't due to a policy change but is reflective of the changing economic and interest rate environment and the strain that can put on banks' balance sheets.
«We want and expect supervisors to help banks focus adequate attention on the areas that matter most for the particular bank,»
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