Trump intends to nominate Bowman as Vice Chairman for Fed Supervision to fill the vacancy left by Powell

According to sources familiar with the matter, US President Donald Trump is expected to nominate Michelle Bowman, a member of the Federal Reserve Board of Governors, as the next Vice Chair for Supervision of the Federal Reserve as early as Wednesday. This move would fill the vacancy left by Michael Barr, who was selected by former President Joe Biden and resigned earlier this year to avoid a dispute with Trump over the position. It is understood that Barr had announced his resignation in January to avoid potential conflicts. Although he believed he would win legally if challenged, he felt that such a fight would cause significant disruption to the Federal Reserve, and therefore, was not a wise course of action. Barr remains a member of the Federal Reserve Board of Governors. Additionally, Bowman's nomination must be approved by the US Senate. Since Barr has not resigned from the Board of Governors, Trump will have to choose a replacement from the remaining board members or wait for a new vacancy to arise. The White House did not immediately respond to requests for comment on the plan to replace Barr with Bowman. Federal Reserve Chairman Jerome Powell had previously informed lawmakers that there had been relatively little volatility in banking regulation policy until the position of Vice Chair for Supervision was established in Congress. He emphasized that the Federal Reserve would "continue to hold the line until a new Vice Chair for Supervision is in place to ensure that we can smoothly carry out our responsibilities." In fact, reports had previously indicated that Bowman was a strong candidate for the position. Trump nominated Bowman as a Federal Reserve Board member in 2018. As a fifth-generation banker, she served as the Commissioner of the Kansas State Banking Department at the time. Bowman was the first appointee to fill the position of Community Bank Expert on the Board of Governors, and she frequently gave wide-ranging insights on banking regulation issues to community bank audiences. Furthermore, Bowman strongly opposed Barr's proposal for bank capital under Basel III, an international agreement aimed at preventing future bank failures and financial crises. She believed that raising capital requirements when the banking industry was healthy could suppress lending activity and argued that banks needed more effective regulation. Ian Katz, Managing Director at Capital Alpha Partners, noted in a report, "Bowman is the most obvious successor. She has been a strong critic of Barr, not only of the final Basel III agreement but also questioned Barr's handling of the process." Bowman also criticized the Federal Reserve's handling of events such as the bankruptcy of Silicon Valley Bank in 2023. While Bowman has focused on the banking sector in most public speeches, she has become one of the more hawkish monetary policy makers at the Federal Reserve, often expressing concerns about inflation pressures. In September, she became the first Board member in 19 years to vote against the Federal Open Market Committee's policy decision, opposing a conventional 50 basis points rate cut and instead advocating for a 25 basis point cut. Earlier this week, Congressman French Hill stated in an interview, "Bowman has performed extremely well in her role as a member of the Federal Reserve Board." He believes that if Trump nominates Bowman for the position of Vice Chair for Supervision, it would be a wise decision. Bowman currently serves as the Chair of the Federal Reserve's Small Regional and Community Bank Committee and has previously served as the Kansas State Banking Commissioner and Vice President of Farmers & Drovers Bank in Kansas.