BIS Head Presses for New-Age, Tough Bank Supervision
BIS General Manager Carstens today absolved central banks in general and the Fed by clear inference from fault in recent bank failures by way of recent interest-rate hikes. Noting also that the Basel III construct is very resilient in design and should have prevented these collapses and then the secondary systemic risk that resulted around the world, Mr. Carstens points instead to failures by bank senior management and directors to execute basic risk-management obligations.
Exec-Comp Clawback Bill Takes Shape
With additional GOP support now also on the Banking Committee, Sen. Warren (D-MA) today introduced a revised version of the earlier, also-bipartisan bill on executive-compensation clawbacks following mid-March bank failures (see FSM Report COMPENSATION35). The new bill covers only banks with assets above $10 billion and direct and indirect compensation over three years, a change from the prior bill’s attempt to capture all compensation.
CFPB Sounds P2P Alarm
Building on its 2022 deposit-insurance representations circular (see FSM Report DEPOSITINSURANCE113), the CFPB today released an issue spotlight warning consumers that funds are at risk with payment apps such as Venmo. The FDIC is heightening pressure on nonbanks that gather funds which consumers may confuse with insured deposits (see FSM Report DEPOSITINSURANCE117), but doing so for payment apps is far more challenging because funds move quickly in and out of insured accounts.