Yellen Stresses Importance of Financial Risk Oversight

December 7, 2024 - 03:59

U.S. Treasury Secretary Janet Yellen emphasized the critical need for a financial risk oversight panel to maintain its operations, amid concerns regarding potential changes under the incoming administration of President-elect Donald Trump. During a meeting of the Financial Stability Oversight Council (FSOC), Yellen highlighted the challenges faced during Trump’s first term, where the panel's staff dwindled to just a few members, severely limiting its effectiveness.

She noted that the reduction in personnel and the scaling back of interagency coordination infrastructure left the council ill-equipped to identify and address financial system risks. Yellen pointed out that the Biden administration took steps to reinvest in the FSOC, which was established in the aftermath of the 2007-2009 financial crisis to monitor systemic risks. Her remarks serve as a reminder of the importance of robust oversight in safeguarding the financial system and ensuring its stability moving forward.