Bowman Pushes for Modernizing Bank Regulations and Mergers

Federal Reserve Vice Chair for Supervision Michelle W. Bowman called for modernizing the bank regulatory framework during a speech at the Community Banking Research Conference in St. Louis on October 6, 2026. Bowman emphasized that the Fed has taken steps to support community banks over the past two years, including refocusing supervision on financial risks, updating the community bank leverage ratio, and eliminating the Novel Activities Supervision Program to encourage innovation.

One key area needing improvement, Bowman said, is the Fed’s approach to bank mergers and acquisitions. She argued that the current competitive analysis disproportionately affects rural banks in small and underserved markets, understating the competition these banks face. Bowman described the analysis as "antiquated and harmful" to community banks, which may struggle to merge even when doing so could strengthen the banking environment.

Bowman also addressed de novo bank formation, noting that the Federal Financial Institutions Examination Council (FFIEC) reaffirmed its support in June. She suggested that federal and state banking agencies could do more to promote new bank formation, including clarifying approval standards and adhering to reasonable processing timelines.

Another focus area is streamlining the call report, or Consolidated Reports of Condition and Income. Bowman mentioned that the FFIEC issued a request for information in December 2025 to seek public comment on reducing the burden of call reports and identifying options for streamlining.