Regulatory Report
Regulatory Report
  • The Fed
  • FDIC
  • OCC
  • NCUA
  • CFPB
  • Other
What's up
  • [ July 1, 2025 ] NCUA shutters small IL credit union after 12-day conservatorship; third to close in two weeks NCUA
  • [ July 1, 2025 ] Seven banks – including Bank of China branches – earn top ratings for CRA compliance OCC
  • [ June 30, 2025 ] Fed: 2025 stress test shows banks ‘well positioned’ to withstand severe recession The Fed
  • [ June 30, 2025 ] Risk on rise for banks in three key areas, OCC reports, as economic uncertainty increases OCC
  • [ June 30, 2025 ] Citing imminent insolvency, credit union regulator closes doors of OH cooperative; members, accounts transferred to another NCUA
HomeFederal financial regulationThe FedFed governor warns of ‘false expectations’ over timeline of applying guidelines for access to Fed services

Fed governor warns of ‘false expectations’ over timeline of applying guidelines for access to Fed services

August 17, 2022 The Fed 0

“False expectations” may be raised about the timeline for evaluating and acting on requests for Federal Reserve account access from non-bank entities based on new guidelines issued earlier this week, a Fed governor said Wednesday.

In remarks to a conference in Little Rock, Ark., Federal Reserve Board Gov. Michelle Bowman said work remains to be completed before a process is established to fully implement the guidelines, which were issued Aug. 15.

The guidelines were issued, at least partly the Fed said,  by the growth of institutions offering new types of financial products or developing “novel charters.”

Many have requested so-called “master accounts” and payment services offered by Federal Reserve banks, the agency said. The guidelines will be used by the banks to evaluate the requests with a “transparent and consistent set of factors.”

But Bowman indicated that those seeking to establish account access based on the new guidelines may have to wait, at least a while longer. “In the meantime, there is a risk that the guidelines could establish false expectations regarding the timeline for evaluating and acting on these requests,” she said.

She said that requests for accounts and services from non-federally insured institutions would generally be subject to a higher standard of review. “The Board expects Reserve Banks to collaborate on reviews of account and service requests, and conduct ongoing monitoring of approved accountholders, to ensure that the guidelines are implemented in a consistent manner,” she said.

In other comments, Bowman suggested that the new “FedNow” payments service, which is scheduled to be available by mid-2023, could obviate the need for a central bank digital currency (CBDC), which is being studied now by the central bank. “My expectation is that FedNow addresses the issues that some have raised about the need for a CBDC,” she said.

She asserted that the new payments system will “help transform the way payments are made through new services that allow consumers and businesses to make payments conveniently, in real time, on any day, and with immediate availability of funds for receivers.”

“Our assessment of these benefits has not changed even as we consider whether a central bank digital currency might fit into the future U.S. money and payments landscape.”

Guidelines released this week on how Federal Reserve Banks will evaluative requests for account access from non-bank entities may raise “false expectations” about the timeline for evaluating and acting on those requests, a Fed governor said Wednesday.

She also outlined supervisory expectations that the Fed is developing regarding digital asset-related activities. Those include, she said:

  • custody of crypto-assets;
  • facilitation of customer purchases and sales of crypto-assets;
  • loans collateralized by crypto-assets, and;
  • issuance and distribution of stablecoins by banking organizations.

“Before a bank begins to engage in or offer crypto-asset-related services, it must seriously and carefully consider the risks involved—both to the bank and its customers. The recent turmoil in the digital-asset industry only underscores that point,” she said.

On Tuesday (Aug. 16), the Fed issued a supervisory letter that urged banks to assess whether engaging in crypto-asset-related activities is legally permissible and determining whether any regulatory filings are required prior to engaging in the activities.

Remarks by Federal Reserve Gov. Michelle W. Bowman at the VenCent Fintech Conference, Little Rock, Arkansas

Related

Today

  • NCUA shutters small IL credit union after 12-day conservatorship; third to close in two weeks

    July 1, 2025 0
    A tiny credit union that was placed into conservatorship June 18 was closed by its federal regulator July 1, the agency said in a release that alleged violations of federal law and rules. It is the third credit union the [...]
  • Seven banks – including Bank of China branches – earn top ratings for CRA compliance

    July 1, 2025 0
    Seven banks – including two branches of the Bank of China – received the highest ratings for compliance with rules implementing anti-redlining laws, according to scores released Tuesday by the national bank regulator. The ratings for compliance with Community Reinvestment [...]
  • Fed: 2025 stress test shows banks ‘well positioned’ to withstand severe recession

    June 30, 2025 0
    The 22 large banks subjected to the Federal Reserve Board’s 2025 stress test reportedly are “well positioned” to withstand a hypothetical, severe recession while remaining above their minimum capital requirements and continuing to lend to households and businesses, the Fed [...]
  • Risk on rise for banks in three key areas, OCC reports, as economic uncertainty increases

    June 30, 2025 0
    Economic uncertainty has increased as consumer sentiment, geopolitical risk, sustained higher interest rates, and downward movement in some macroeconomic indicators have all had their impact on threats to the banking system, the national bank regulator said Monday. In its Semiannual [...]
  • Citing imminent insolvency, credit union regulator closes doors of OH cooperative; members, accounts transferred to another

    June 30, 2025 0
    A Middletown, Ohio, credit union has been closed and its members and their accounts moved to a Cincinnati, Ohio, credit union, the federal regulator said Monday. Butler Heritage Federal Credit Union (FCU) of Middletown was liquidated by the National Credit [...]
  • 2 former credit union employees barred from future work in insured FIs

    June 30, 2025 0
    A former employee of a Kansas credit union and one from a credit union in Pennsylvania are barred from participating in the affairs of any federally insured depository institution, the federal credit union regulator said Monday. The National Credit Union [...]
  • Texas bank became second to fail so far this year

    June 30, 2025 0
    A Santa Anna, Texas, bank was closed late Friday by the national bank regulator, becoming the second bank to fail so far this year. Santa Anna National Bank was closed by the Office of the Comptroller of the Currency (OCC), [...]

Resources

  • About
  • Get our daily reports
    • Registration
  • Password Reset
  • Reg lookup
  • Profile

Follow @editorregreport

  • The Fed
  • FDIC
  • OCC
  • NCUA
  • CFPB
  • Other

Copyright (c) 2022, RegReport.info; Contact: editor@regreport.info