FDIC's Gruenberg: Nonbank Sector Key Area of Focus
Hot topics like cybersecurity, M&A and Operation Choke Point caused a lot of debate at American Banker's annual regulatory symposium. But in just about every case, the conversation inevitably circled back to a common theme: reputation is everything. So some, including U.S. Bancorp's Richard Davis, contend playing it safe is just plain playing it smart.
New York regulator Benjamin Lawsky may use the cybersecurity rules he's proposed for virtual-currency companies as a model for traditional banks. That would subject the financial institutions his agency supervises to the most stringent data-security rules anywhere.
WASHINGTON Federal Deposit Insurance Corp. Chairman Martin Gruenberg said Monday that federal regulators are keeping a close eye on the nonbank financial sector and how it is affecting banks.
Speaking at a Risk Management Association conference here, Gruenberg was asked about the "encroachment" of technology firms that are now entering the banking space. The FDIC chief didn't answer directly, but cited other concerns about "the so-called shadow banking sector" as "one of the key areas of focus for the regulatory agencies."
"The impact of the nonbanking sector on the insured sector the relations between the two and the interlocking risks associated with that are probably one of the key areas of focus going forward," Gruenberg said.
He also reiterated the need for banks, and in particular senior management, to embrace the importance of cybersecurity.
"I think this is going to be one of the key issues for the industry going forward for both large and small institutions and for the federal regulators as well and I think this is an ongoing process," Gruenberg said. "I think we are getting up the learning curve, for the industry and the regulators on this and it is going to be a key priority both for the institutions and the regulators.