Private Warnings Issued by Federal Reserve
The Federal Reserve has reportedly issued a series of private warnings to lenders possessing assets ranging from $100 billion to $250 billion, as part of a broader initiative to enhance supervision, as per Bloomberg News sources. Citizens Financial (NYSE: CFG), Fifth Third Bancorp (NASDAQ: FITB), and M&T Bank Corp (NYSE: MTB) were among the institutions that received these warnings, the report added.
Scope of the Warnings
The warnings addressed a variety of concerns, including the capital and liquidity of the lenders, as well as technology and compliance issues, as indicated in the report. Both the banks and the Federal Reserve did not immediately respond to requests for comments from Reuters.
Impact of the Recent Banking Crisis
Banks are currently grappling with the repercussions of the most significant crisis in the sector since 2008, which resulted in the collapse of three mid-sized lenders earlier this year. These failures revealed the susceptibilities of banks to escalating interest rates and demonstrated how rapidly alarmed customers can withdraw their deposits, instigating a bank run.