In remarks at the 2026 Community Banking Research Conference, Federal Reserve Board Vice Chair for Supervision Michelle W. Bowman announced that the Federal Reserve is beginning to reorganize its supervisory function into five regions. The realignment is intended to establish clearer decision-making authority and accountability, replacing a structure complicated by Reserve Bank responsibilities and numerous committees. Bowman also outlined planned changes to asset thresholds and the large-bank tailoring framework. Each new region will have a leader accountable for all supervisory activity within its boundaries. The regions will follow state lines rather than Federal Reserve District boundaries to improve coordination with state and federal regulators. Examiners will remain at existing Reserve Bank locations and continue supervising their current institutions. The restructuring responds in part to an independent review of Silicon Valley Bank’s failure, which identified a mismatch between authority and accountability in Federal Reserve supervision. Later in 2026, the Board will consider raising fixed-dollar regulatory thresholds to reflect inflation and economic growth, with automatic updates every five years. It will also consider broader changes to asset-based supervisory portfolios and the large-bank tailoring framework, potentially expanding the range of traditional, noncomplex institutions treated as community banks. Bowman said the agencies are also working to finalize CAMELS rating revisions that would focus ratings on material financial risks and prevent the Management component from singularly determining a composite rating.

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