The Federal Reserve will move to implement the provisions of S. 2155 — the new regulatory reform law — as quickly as possible, Federal Reserve Chairman Jerome Powell said in testimony before the Senate Banking Committee today. “Our intention and our practice is going to be to implement the bill as soon as we possibly can,” he said, adding that the Fed had already taken steps to lay out its plans for action in a statement it issued earlier this month.
Powell noted that the Fed’s approach to regulatory reform is centered on making regulation more efficient so that banks can devote more of their efforts to making loans and supporting economic activities in their communities. “We want regulation to be as efficient [and] effective as it can possibly be. Good regulation has very positive benefit . . . but nobody benefits when regulation is inefficient.”
Powell also indicated the Fed intends to publish soon for public comment “the range of factors we can consider” in applying prudential standards. The American Bankers Association has long argued that regulation should be tailored based on business model and risk profile rather than asset size, and the new reform law requires regulators to follow this principle in implementation and beyond. The association continues to engage with its members to provide feedback to the Fed on how it can best achieve efficient regulation through tailoring.