The Federal Reserve has issued private warnings to banks with assets in the range of $100 billion to $250 billion, including Citizens Financial Group (CFG), Fifth Third Bancorp (FITB), and M&T Bank Corp (MTB), according to a Bloomberg report. These confidential notices cover diverse areas such as capital, liquidity, technology, and compliance.
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The surge of these warnings, known as “matters requiring attention [MRA]” and “matters requiring immediate attention [MRIA]” reflects a broader increase in regulatory scrutiny, especially after the collapse of regional banks including First Republic Bank, Silicon Valley Bank, and Signature Bank earlier this year.
The rising oversight from the Fed comes as its vice chair for supervision, Michael Barr had vowed “to “improve the speed, force and agility” of regulation earlier this year. According to the report, these private notices require a “board-level” reply and taking corrective actions could be an expensive affair.
The turmoil among the regional banks has affected the SPDR S&P Regional Banking ETF (KRE), which has declined by more than 20% year-to-date.
