That brings me to my next point, which is that examiners have a key role to play in reviewing and assessing the quality of a bank’s internal controls, compliance, internal audit, et cetera. A central element of the Federal Reserve’s supervisory programs is assessing the effectiveness of these processes and functions.
However, the recognition that eventual crises could have heavy fiscal costs would seem to imply that Treasury officials might also be interested in both constructing and participating in a macroprudential framework that operates effectively. Just as war is too important to be left to the generals, financial stability may be too important to be left to the prudential authorities and the central bankers. 1.