(May 25 – 4:30 ET) – A strong economy will not shield banks from risk, said U.S. Federal Reserve Chairman Alan Greenspan in a speech today at the National Association of Urban Bankers conference in San Francisco. He urged them to remain vigilant against fraud and lax standards.
Greenspan did not make any mention about interest rates or the general economic outlook, disappointing interest rate watchers and traders alike. Instead he focused on buoying the country’s banking infrastructure.
“The high cost of recent failures reinforces lessons of the past for banks and supervisors,
including the need for continuous vigilance against causes of bank failure such as fraud,
credit concentrations, and rapid entry into new and unfamiliar activities,” he said.
-IE Staff