The Federal Reserve Board announced on Wednesday that it has withdrawn its 2023 policy statement and released a new policy statement regarding the treatment of certain Board-supervised banks. The updated approach is intended to support responsible innovation within the banking sector.
“New technologies offer efficiencies to banks and improved products and services to bank customers,” said Vice Chair for Supervision Michelle W. Bowman. “By creating a pathway for responsible, innovative products and services, the Board is helping ensure that the banking sector remains safe and sound while also modern, efficient, and effective.”
The 2023 policy statement had restricted Board-supervised state member banks to engaging only in activities permitted for banks supervised by other federal regulatory agencies. It also addressed how these rules would apply to some innovative financial products and services. However, according to the Federal Reserve Board, changes in the financial system and an increased understanding of innovative offerings have made the previous policy outdated.
Withdrawing the earlier guidance, the new policy statement provides a framework allowing both insured and uninsured state member banks under Board supervision to participate in certain innovative activities.
Further details can be found in the official Federal Register notice: Policy Statement on Section 9(13) of the Federal Reserve Act (PDF), as well as in an accompanying Board Memo (PDF).
