Big bank oversight to stay with Fed

Tom Braithwaite
Financial Times
March 8, 2010

Banks with more than $100bn of assets will be overseen by the US Federal Reserve under a regulatory reform plan that represents a partial victory for the central bank after months of attacks in Congress.

Chris Dodd, the Senate banking committee chairman, had proposed hiving off all bank supervision to a single regulator but is set to propose this week that the 23 largest institutions stay under the Fed’s oversight, according to people familiar with the plans.

At issue over the weekend was the regulation of several hundred state chartered institutions that also want to remain under the Fed’s supervision.

While attention has been focused on an argument between Democrats and Republicans over the powers and location of new consumer protection functions, which may also be housed within the Fed, other elements of regulatory reform – deemed more important by many institutions and policymakers – are close to fruition.

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