Kevin Warsh, tapped by President Donald Trump to chair the Federal Reserve, is expected to bolster efforts to ease Wall Street bank regulations and grant the administration greater influence over regulatory and supervisory matters, according to regulatory experts. Warsh, a Republican and former Fed governor, was selected to succeed current Fed Chairman Jerome Powell when his term concludes in May. The Federal Reserve, a central banking system, is the primary regulatory body overseeing the nation’s largest banks.
Experts suggest that Warsh’s confirmation by the Senate would likely amplify the deregulatory initiatives spearheaded by Vice Chair for Supervision Michelle Bowman, another Trump appointee, thereby aligning financial policy more closely with the administration’s objectives. Some analysts point out that while Powell has generally supported deregulation, he has at times served as a moderating influence.
Warsh has previously voiced criticism of the unfolding reforms following the 2008 financial crisis. He also expressed the view that the Fed should not be independent regarding bank regulation, indicating support for an aggressive deregulatory agenda. Wall Street banks have responded positively to the news, citing Warsh’s prior experience at the Fed and within the banking sector as beneficial for the industry.
Furthermore, some investors and analysts have noted Warsh’s interest in reducing the Fed’s balance sheet, which would diminish the central bank’s presence in financial markets and potentially increase the role of private banks. While Warsh has defended the independence of the Fed’s monetary policy, he has stated that regulatory and supervisory policy should be subject to political oversight, aligning with the Trump administration’s increasing role in guiding financial regulation.
