UPDATE 2-Fed to consider tougher rules for midsize banks after SVB collapse-source

(Recasts, adds detail, sourcing) By Pete Schroeder March 14 (Reuters) - The Federal Reserve is considering tougher rules and oversight for midsize banks similar in size to Silicon Valley Bank , which collapsed suddenly last week, according to a source familiar with the matter. The bank's collapse set off fears across the financial system, drove an extraordinary government effort to reassure depositors and backstop the system, and set off debate about reversing previous rule easing for regional banks. Now, a review of the $209 billion bank's failure being conducted by Fed Vice Chair for Supervision Michael Barr could lead to strengthened rules on banks in the $100 billion to $250 billion range, the source told Reuters. That review of Fed supervision and regulation of the bank will be released by May 1, and augments a review of bank capital rules by Barr already underway. The Wall Street Journal reported on Tuesday the Fed was reconsidering regulations regarding midsize banks, which could lead to more stringent capital and liquidity requirements and potentially beefed up annual "stress tests." Currently, the toughest capital and liquidity requirements are reserved for the nation's largest banks, after a 2018 deregulation law from Congress and Fed rule-making under prior leadership eased those rules for smaller firms. Larger firms also face more frequent and rigorous stress testing and accounting requirements. All those requirements could be reworked by the Fed in the aftermath of the collapse, which has also spurred fresh calls from proponents of tougher rules for regulators to rebuild those restrictions. On Tuesday, 50 Democratic lawmakers, including Senator Elizabeth Warren, introduced a bill to repeal the law that eased rules for banks in 2018. (Reporting by Yana Gaur in Bengaluru and Pete Schroeder in Washington Editing by Shri Navaratnam and Sam Holmes)