Fed moving toward regulatory changes

Providing members of the Senate Committee on Banking, Housing and Urban Affairs with an update on the Fed's progress complying with the sweeping reform measure, Federal Reserve Ben Bernanke said Thursday that new rules, studies, reports and transfers of responsibility -- both to the Fed and away -- were required "within a relatively short period."

The Fed has created a staff position "to coordinate our efforts," he said.

Bernanke said the bill signed into law in July required the Fed to expand oversight to include "nonbank financial firms that are designated as systemically important" by the Financial Stability Oversight Council. In general, he said the bill expanded regulatory focus from individual firms to include firms that were operating under the radar in the past but must now be considered if their size makes their vulnerability a systemic issue.

"The Dodd-Frank Act addresses critical gaps and weaknesses of the U.S. regulatory framework, many of which were revealed by the crisis," he said.

The Fed was also getting ready to hand over some of its duties to the newly created Bureau of Consumer Financial Protection, he said.

"Work is well under way to transfer … responsibilities," he said.

Copyright 2010 United Press International,