WASHINGTON (AP) -- Federal Reserve Chairman Ben Bernanke on Wednesday urged Congress not to scale back the Fed's regulatory authority over banks. He said the Fed needs the information it gleans from its bank oversight to set interest rates and gauge the health of the banking system.
A Senate bill to overhaul financial regulation would strip the Fed of its power to supervise state-chartered banks and bank holding companies with assets of less than $50 billion. That would leave the Fed to oversee only 35 big bank holding companies.
Critics have blamed lax regulation at the Fed and at other agencies for contributing to the financial crisis.
Testifying to the House Financial Services Committee, Bernanke once again acknowledged that the Fed's past regulatory failures played a role in the crisis. But he said, as he has before, that the central bank has improved its regulatory oversight.
Others testifying at Wednesday's hearing echoed some of Bernanke's arguments.
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