The Financial Stability Oversight Council (FSOC), which is part of the Treasury Department, held an unscheduled, private meeting on March 24 via video conference, according to a statement from the department. The gathering was organized by Treasury Secretary Janet Yellen.
The Treasury statement provided few details, but it did mention that staff from the Federal Reserve Bank of New York gave a presentation on market developments. The presentation’s main message was comforting: “The Council discussed current banking sector conditions and noted that, despite some institutions experiencing stress, the U.S. banking system remains sound and resilient.”
The council also talked about how member organizations track financial developments. “Identifying risks to the financial stability of the United States; promoting market discipline; and responding to emerging threats to the stability of the U.S. financial system” are the duties of the FSOC as defined by the law.
As worries about the American banking crisis spread, practically every statement she and meeting participant Federal Reserve Board Chair Jerome Powell made in public was met with sharp market reaction.
Andy Barr and Bill Huizenga, the co-chairs of the House Financial Services Committee Subcommittee, wrote Yellen a letter on March 24 requesting the unredacted minutes of the FSOC meeting on March 12 and a special meeting with council “leaders” on March 10 to discuss the failure of Silicon Valley Bank and other details.
The FSOC’s transparency was criticized by Barr and Huizenga, who also stated that the lack of a separate website or press releases by the FSOC “blurs the line between your role as Chairperson of the FSOC and as Secretary of the Treasury.”
The FSOC has repeatedly urged Congress to enact legislation governing cryptocurrencies. It has also urged Congress to close regulatory loopholes and called on lawmakers to choose which regulator will be in charge of overseeing the cryptocurrency spot market.