Vice Chair for Supervision at the Federal Reserve, Michelle Bowman, said she aims to reduce the size of the supervision and regulation division by roughly 30%.
According to people familiar with the matter, the reductions will mainly occur through attrition, retirements, and voluntary separation incentives.
“She expects S&R to have a smaller overall footprint of roughly 350 employees – a reduction of approximately 30% from the previous authorized headcount of nearly 500 employees – by year-end 2026,” according to a staff memo seen by Bloomberg.
News of the headcount reduction comes as Bowman and other U.S. regulators have been working towards easing bank capital rules. It also comes on the heels of wider plans at the country’s central bank to pare down its workforce by about 10% over the next couple of years, and aligns with efforts by the Trump administration to scale back U.S. financial regulators.
Bowman reportedly stressed that her unit’s staff should focus more on the banks’ material risks, rather than be distracted by work that doesn’t directly impact a firm’s safety and soundness.
Bowman landed in the role in June after being praised by financial institutions for her support to curtail what some view as overly burdensome regulatory rules. For example, she led efforts to curb multiple measures enacted under the Biden administration and spearheaded initiatives to ease capital requirements for loans on Wall Street.