Minutes of the Financial Stability Oversight Council

March 24, 2023

PRESENT: 

Janet L. Yellen, Secretary of the Treasury and Chairperson of the Financial Stability Oversight 

Council (Council)

Jerome H. Powell, Chair, Board of Governors of the Federal Reserve System (Federal Reserve)

Martin Gruenberg, Chairman, Federal Deposit Insurance Corporation (FDIC)

Gary Gensler, Chair, Securities and Exchange Commission (SEC) 

Rostin Behnam, Chairman, Commodity Futures Trading Commission (CFTC)

Rohit Chopra, Director, Consumer Financial Protection Bureau (CFPB)

Sandra L. Thompson, Director, Federal Housing Finance Agency (FHFA)

Michael J. Hsu, Acting Comptroller of the Currency, Office of the Comptroller of the Currency 

(OCC) 

Todd M. Harper, Chairman, National Credit Union Administration (NCUA)

Thomas E. Workman, Independent Member with Insurance Expertise

James Martin, Acting Director, Office of Financial Research (OFR), Department of the Treasury 

(non-voting member)

Steven Seitz, Director, Federal Insurance Office (FIO), Department of the Treasury (non-voting 

member)

Adrienne Harris, Superintendent, New York Department of Financial Services (non-voting 

member) 

Elizabeth K. Dwyer, Superintendent of Financial Services, Rhode Island Department of Business 

Regulation (non-voting member)

Melanie Lubin, Securities Commissioner, Maryland Office of the Attorney General, Securities 

Division (non-voting member)

GUESTS: 

Department of the Treasury (Treasury)

Didem Nisanci, Chief of Staff

Nellie Liang, Under Secretary for Domestic Finance

Sandra Lee, Deputy Assistant Secretary for the Council

Laurie Schaffer, Principal Deputy General Counsel

Eric Froman, Assistant General Counsel (Banking and Finance)

Sean Hoskins, Director of Policy, Office of the Financial Stability Oversight Council 

Board of Governors of the Federal Reserve System

Michael Barr, Vice Chair for Supervision

Andreas Lehnert, Director, Division of Financial Stability

Federal Deposit Insurance Corporation

James McGraw, Senior Deputy Director, Division of Complex Institution Supervision and 

Resolution
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Securities and Exchange Commission

Amanda Fischer, Chief of Staff

Commodity Futures Trading Commission

Rahul Varma, Acting Deputy Director, Division of Market Oversight

Consumer Financial Protection Bureau

Gregg Gelzinis, Advisor to the Director

Federal Housing Finance Agency

Joshua Stallings, Deputy Director, Division of Bank Regulation

Comptroller of the Currency

Jay Gallagher, Senior Deputy Comptroller for Supervision Risk and Analysis

National Credit Union Administration

Andrew Leventis, Chief Economist

Office of the Independent Member with Insurance Expertise

Charles Klingman, Senior Policy Advisor

Federal Reserve Bank of New York

John Williams, President

Dianne Dobbeck, Head of Supervision

Office of Financial Research

Sriram Rajan, Associate Director, Research and Analysis Center

Federal Insurance Office

Philip Goodman, Senior Insurance Regulatory Policy Analyst

New York Department of Financial Services

Karen Lawson, Executive Vice President for Policy and Supervision, Conference of State Bank 

Supervisors

Rhode Island Department of Business Regulation

Ethan Sonnichsen, Managing Director, National Association of Insurance Commissioners 

Maryland Office of the Attorney General, Securities Division

Vincente Martinez, General Counsel, North American Securities Administrators Association

PRESENTERS:

Update on Market Developments 

• Julie Remache, Deputy System Open Market Account (SOMA) Manager and Head of 

Market and Portfolio Analysis, Markets Group, Federal Reserve Bank of New York 
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• Stephanie Curcuru, Deputy Director, Division of International Finance, Federal Reserve

(available for questions)

Executive Session

The Chairperson called the executive session of the meeting of the Council to order at 

approximately 10:00 A.M. The Council convened by videoconference. The Chairperson began 

by outlining the meeting agenda, which had previously been distributed to the members together 

with other materials. The agenda for the executive session was an update on domestic and 

international financial market developments.

1. Update on Market Developments 

The Chairperson stated that she had convened this meeting so that Council members could share 

information about the latest financial market developments, both domestically and 

internationally. She said that the actions by Swiss authorities the previous weekend related to the 

acquisition of Credit Suisse by UBS had helped support financial stability and prevent the 

significant spillovers that could otherwise have occurred. She said that domestically, while some 

institutions had come under stress, the U.S. banking system remained sound and resilient. She 

stated that it was important to continue to monitor these stresses and consider what additional 

steps could be taken, if necessary. 

The Chairperson then turned to Julie Remache, Deputy SOMA Manager and Head of Market and 

Portfolio Analysis in the Markets Group at the Federal Reserve Bank of New York. Ms. 

Remache discussed the financial market impact of recent stress in the banking sector stemming 

from the failures of Silicon Valley Bank (SVB) and Signature Bank and the acquisition of Credit 

Suisse by UBS. She said that asset price volatility had been elevated in 2023. She discussed 

recent swings in interest rates and a deterioration in Treasury market liquidity, although she 

noted that volatility and liquidity conditions had abated since the previous week. She stated that 

since the failure of SVB, equity valuations for some U.S. banks had remained significantly 

lower, and their credit default swap spreads had increased. She stated that while market 

participants expressed concerns about profitability and that valuations of U.S. banks had 

declined, they remained robust relative to banking sectors in other countries. She stated that 

banks appeared to have been able to access the liquidity they needed through the Federal 

Reserve’s discount window or its recently created Bank Term Funding Program, or by borrowing 

from the Federal Home Loan Banks. She said that the actions taken by the official sector in both 

the United States and Switzerland had supported market confidence, although she noted that 

investor sentiment remained fragile. Addressing the potential impact on credit conditions of the 

stress in the banking sector, she noted that small and medium-sized banks accounted for a 

significant share of commercial real estate lending and of lending to small and mid-sized 

enterprises. She concluded by stating that the Federal Reserve would continue to monitor 

developments in financial markets; at small, regional, and large banks; and in funding markets. 

The Chairperson stated that as market events unfolded in the coming days and weeks, it would 

be essential for Council members to continue to maintain open lines of communication. She said 

that she was again asking staff from all member agencies to closely monitor developments in 
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financial institutions and markets. She then invited Council members to provide updates on 

recent developments in their regulated institutions and markets.

Council members then had a discussion about recent market developments, including the 

responses of domestic and international regulators; factors contributing to the failure of SVB and 

Signature Bank, and the risk of contagion from those failures; the acquisition of Credit Suisse by 

UBS; the recent increase in government money market fund assets; the recent increase in 

advances by the Federal Home Loan Banks; information-sharing among Council member 

agencies; and potential evaluations regarding whether changes to supervisory or regulatory 

approaches may be appropriate.

The Chairperson adjourned the meeting at approximately 10:42 A.M.