The move fills a post vacated by Michael Barr, who was picked by former President Joe Biden and resigned from that job earlier this year — avoiding a potential fight with Trump over the role. Barr said in January, “the risk of a dispute over the position could be a distraction from our mission.”
The vice chair for supervision must be a member of the Fed’s board, and since Barr didn’t step down from his role on the Fed’s Board of Governors, Trump has to choose a replacement from among the remaining board members or wait for a new vacancy. The White House didn’t immediately respond to a request for comment on the plan to replace Barr with Bowman.
Bank Capital Proposal
Bowman was a strong critic of the US regulators’ plan to force the country’s biggest lenders to hold significantly more capital to buffer against losses and a financial crisis. The industry had argued that the original proposal unveiled in 2023 would put US banks at a disadvantage against international rivals.
Also Read: Cooler US inflation in February puts Fed’s next move in focus
In September, Barr previewed extensive revisions that would roughly slice in half the 19% capital hike that regulators had planned for the biggest US banks. At the time, Bowman recommended a full re-proposal of the capital rules.
Federal Reserve Chair Jerome Powell told lawmakers in February that he hoped a version of the long-awaited plan could be reached “fairly quickly.” “We remain committed to completing Basel III Endgame. We think it’s good for US banks, it’s good for our economy that there be a global standard beneath which foreign banks can’t fall,” Powell said at a Senate Banking Committee hearing.
Powell also told lawmakers last month that bank regulatory policy was less volatile before Congress established a vice chair for the supervision position. He said that the central bank will “continue until there’s a new vice chair for supervision and we can very much get our work done.”
Also Read: Bitcoin rallies past $84K as US inflation cools, focus shifts to Fed policy
Bowman, a fifth-generation banker, has previously served as the state bank commissioner of Kansas and was a vice president at Farmers & Drovers Bank. She became a member of the Fed’s board in 2018 and chairs the central bank’s Subcommittee on Smaller Regional and Community Banking.
Bowman dissented against the Fed’s decision to lower interest rates by a half percentage point in September. She said at the time she preferred a more “measured” approach and would have favored a quarter percentage point cut. Her nomination to serve as vice chair for supervision would have to be confirmed by the US Senate.
