Illegal bookmaking, crypto scams and doing too much by cellphone — what being in the mafia is like in 2025

My testimony today will focus on two areas. First, the current state of the banking sector, as detailed in the fall 2025 Supervision and Regulation Report, which accompanies my submission to the Committee. Second, progress on my priorities as Vice Chair for Supervision since my confirmation earlier this year. My priorities relate to the efficiency, safety and soundness, and stability of our financial system and the effectiveness and accountability of our regulation and supervision of that system. The financial sector plays a critical role in our economy because it serves as an essential intermediary to channel savings into productive investments and enable the flow of money, credit, and capital throughout the economy. Our supervision and regulation must support a safe and sound banking system that fosters economic growth while also safeguarding financial stability. Banking Conditions Let me begin by providing an update on banking conditions. As the Supervision and Regulation Report shows, the banking system remains sound and resilient. Banks continue to report strong capital ratios and significant liquidity buffers, which position them well to support economic growth. The overall health of the banking sector is demonstrated by continued growth in lending, a decline in non-performing loans across most categories, and strong profitability. Notably though, nonbank financial institutions continue to increase their share of the total lending market, providing strong competition to regulated banks without facing the same capital, liquidity, and other prudential standards. Fed's Bowman: Working on capital and liquidity rules tied to Stablecoin Fed's Bowman: Nonbank firms increasing their share of the lending market.