Official has called for reform of bank supervision and 'pragmatic' regulatory approach
The US Senate confirmed Michelle Bowman as the Federal Reserve’s vice chair for supervision on Wednesday, in a 48-46 vote largely along party lines. Bowman, who has served as a Federal Reserve governor since 2018, assumes the central bank’s top regulatory role following Michael Barr’s resignation from the position in February.
Bowman’s confirmation is expected to influence the mortgage industry due to her stated views on bank capital requirements and regulatory tailoring. During her April 2025 nomination hearing before the Senate Banking Committee, Bowman emphasized that bank supervision should be “reformed and refocused” to address core financial risks and that regulations must be approached “in a pragmatic way that ensures they are efficient and effective.”
Industry and political reactions diverge
Industry groups, including the American Bankers Association and the Independent Community Bankers of America, have praised Bowman’s confirmation. Rob Nichols, president and CEO of the American Bankers Association, stated, “With her deep experience as a federal regulator, state regulator, and community banker, Governor Bowman understands the real-world impact US banking rules can have on the economy and consumers.”
Senator Elizabeth Warren (D-Mass.), ranking member of the Senate banking, housing, and urban affairs committee, strongly urged her colleagues to oppose Bowman’s nomination. Speaking on the Senate floor, Warren stated, “During her tenure, (Bowman) has consistently prioritized Wall Street over Main Street. She has weakened safeguards on the largest banks in the country and has opposed common sense rules to promote financial stability, protect consumers, and drive investment in communities across the country.” Warren pointed to Bowman’s vote “just yesterday” to lift the asset cap on Wells Fargo.
Balancing risk and economic impact
Bowman has previously expressed concerns about the Basel III endgame bank-capital proposal, which would have increased capital requirements for large US banks. She has indicated that the proposal’s costs would be substantial and has supported modifying it to address issues such as over-calibration and a lack of regulatory tailoring.
“I am open to considering proposals to improve capital regulation, particularly evidence-based proposals that would address known deficiencies and shortcomings,” Bowman said. “When the board is considering changes to the capital framework, particularly significant increases in capital, we must carefully weigh the trade-offs of increased safety from higher capital levels, and the costs to banks, consumers, businesses, and the broader economy. We must also factor in the broader regulatory landscape, and how changes to capital regulations may complement, overlap, or conflict with other regulatory requirements.”
She has also advocated for the ability of US regulators to deviate from international Basel standards to suit the specific characteristics of the US banking system.
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