#Foster – Federal Financial Analytics

Eliza Allen2023-05-17T16:03:47-04:00May 17th, 2023|5- Client Report|

HFSC Subcommittees Plow More Ground for Supervisory Accountability, Capital Reform, Clawbacks

A joint hearing today of HFSC’s Financial Institutions and Oversight Subcommittees expanded on themes at yesterday’s full Committee session with bank regulators (see Client Report REFORM224) and Senate Banking’s session with SVB’s and SBNY’s CEOs, with First Republic’s CEO now added to the Congressional firing line. Much in this session repeated prior themes, with Rep. Dave Scott (D-GA) going beyond prior, sharp criticism to accuse SVB’s CEO of being the worst CEO in U.S. financial history. Democrats demanded that he give up the bonus he received the day SVB failed and he went to Hawaii, receiving little satisfaction on this score and continuing demands for clawback legislation. Rep. Bill Foster (D-IL) continued to argue that contingent-capital instruments would ensure smooth resolutions, a position he said is shared by Chairman McHenry (R-NC) even though it supports a controversial Fed/FDIC proposal for regional-bank TLAC (see FSM Report RESOLVE48).

REFORM225.pdf…

Daily113021

Arezou Rafikian2023-05-23T14:25:32-04:00November 30th, 2021|2- Daily Briefing|

FSB Revisits Cross-Border GSIB Resolution Quandary
Continuing its work to end TBTF banks, the FSB today issued good practices for the crisis management groups that would take on a troubled GSIB. It is striking that this statement does not use the more conventional “best practices” designation; one can only speculate that this is due to limited English proficiency by the final drafts people or the document fell short of what some FSB participants believed behooved best practice.

Waters, Foster Urge Rules to Combat Algo Bias
Continuing a recent hearing theme, HFSC Chairwoman Waters (D-CA) and AI Task Force Chair Foster (D-IL) late yesterday urged federal financial regulators to ensure that AI/ML is algorithmic-bias free. Responding to the regulators’ request for information on AI use (see FSM Report AI), they argue that historical data may perpetuate longstanding bias and create models that discriminate against protected classes.

Clarida Stands By Fed Emergency Market Interventions
Outgoing FRB Vice Chairman Clarida today argued that the Fed has carefully deployed its 13(3) emergency powers and thus preserved its independence.

Daily113021.pdf…