If Robby the Robot were a Federal Reserve regulator, this would his message, translated to Robotese from the Fed announcement Monday: Bankers, be warned. Get your collective act together, because we'll be watching more closely.
Large bank holding companies, the Fed said, have "considerably improved" their practices, but they have "more work to do" when it comes to setting up the capital they need to cope with economic and financial stress.
So, the regulator emphasized, bankers need to "focus on the specific risks they could face under potentially stressful economic conditions."
Federal Reserve evaluators surveyed their own observations over the past three years, and noted that they will add 12 firms to the 18 that participated in this year's Comprehensive Capital Analysis and Review. The review will deal with capital planning and risk accounting at firms with more than $50 billion in total assets.
Comment: Such risk monitoring should have started before the crisis.
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