signs of slowing down. the large number of finalized, proposed, and potential changes suggest insufficient prioritization in furthering the primary goal of prudential bank regulation and supervision - promoting a safe and sound banking system. in fulfilling this statutory objective, we must also focus on efficiency and effectiveness and always consider how regulatory reforms affect the banking market, the economy, and those who use banking services. we should also ensure, in our pursuit of reform, that our efforts result in a bank framework that is appropriately tailored and calibrated. i have spoken at length over the past few months about some recent notable developments in bank regulation, touching on capital reform, the community reinvestment act, the cap on debit card interchange fees, and climate - related financial risk guidance. 2 today, i want to recap my views on some of these developments, particularly around bank mergers and acquisitions ( m & a ), liquidity regulation, and trends in bank supervision. bank mergers and acquisitions 2 / 5 bis - central bankers'speeches bank mergers and acquisitions continue to be an important part of the banking ecosystem. in this process, timing is key. however, this is another policy area where i expect to see ongoing focus from federal regulators, the department of justice, and others. as policymakers engage on this topic, a key consideration should be whether the application process is fair, transparent, and consistent with the applicable statutory requirements. 3 and yet, policy reforms may make bank m & a transactions more difficult for regulators to approve and slow the application processing timeline. as all bankers know, application processing delays can be quite harmful, resulting in greater operational risk, increased expenses due in part to contract delays, reputational risk, and staff attrition due to the prolonged uncertainty. in the broader context, reducing the efficiency of bank mergers and acquisitions may also act as a deterrent to a healthy evolution of the banking system. taken together, reducing merger or acquisition activity could have the consequence of prohibiting transactions that may preserve the presence of banks in rural or underserved areas, transactions that may further prudent growth strategies, or transactions that may result in increased competition with larger peers. regulatory reforms in this area should prioritize speed and timeliness. stakeholders who are concerned about current bank m & a procedures and policies should consider direct engagement with regulators. 4 liquidity following the bank failures last spring, significant attention has been paid to the alleged " lessons learned " creating a path for regulatory reform efforts. this

jerome h powell : semiannual monetary policy report to the congress testimony by mr jerome h powell, chairman of the board of governors of the federal reserve system, before the committee on financial services, us house of representatives, washington dc, 27 february 2018. * * * chairman hensarling, ranking member waters, and members of the committee, i am pleased to present the federal reserve ’ s semiannual monetary policy report to the congress. on the occasion of my first appearance before this committee as chairman of the federal reserve, i want to express my appreciation for my predecessor, chair janet yellen, and her important contributions. during her term as chair, the economy continued to strengthen and federal reserve policymakers began to normalize both the level of interest rates and the size of the balance sheet. together, chair yellen and i have worked to ensure a smooth leadership transition and provide for continuity in monetary policy. i also want to express my appreciation for my colleagues on the federal open market committee ( fomc ). finally, i want to affirm my continued support for the objectives assigned to us by the congress — maximum employment and price stability — and for transparency about the federal reserve ’ s policies and programs. transparency is the foundation for our accountability, and i am committed to clearly explaining what we are doing and why we are doing it. today i will briefly discuss the current economic situation and outlook before turning to monetary policy. current economic situation and outlook the u. s. economy grew at a solid pace over the second half of 2017 and into this year. monthly job gains averaged 179, 000 from july through december, and payrolls rose an additional 200, 000 in january. this pace of job growth was sufficient to push the unemployment rate down to 4. 1 percent, about 3 / 4 percentage point lower than a year earlier and the lowest level since december 2000. in addition, the labor force participation rate remained roughly unchanged, on net, as it has for the past several years — that is a sign of job market strength, given that retiring baby boomers are putting downward pressure on the participation rate. strong job gains in recent years have led to widespread reductions in unemployment across the income spectrum and for all major demographic groups. for example, the unemployment rate for adults without a high school education has fallen from about 15 percent in 2009 to 5 - 1 / 2 percent in january of this year, while the jobless rate for those with a college degree has moved down from 5 percent to