Fed Governor Michael Barr criticized recent rollbacks easing limits on bank lending, saying proposals have substantially weakened bank oversight and that vulnerabilities from looser rules may not be visible now but could accumulate over several years and cause serious economic damage. He said Trump-era officials loosened capital requirements, narrowed the regulatory perimeter and facilitated competition between traditional banks and private-credit firms. Barr warned that weaker capital, liquidit

Fed Governor Michael Barr criticized recent rollbacks easing limits on bank lending, saying proposals have substantially weakened bank oversight and that vulnerabilities from looser rules may not be visible now but could accumulate over several years and cause serious economic damage. He said Trump-era officials loosened capital requirements, narrowed the regulatory perimeter and facilitated competition between traditional banks and private-credit firms. Barr warned that weaker capital, liquidity and supervisory standards would raise the risk of bank stress; while banks need room to support economic innovation, history shows profit-driven innovation without adequate safeguards can create excessive risk that, if realized, threatens firms, households and the broader economy.