Senate Committee Expected To Grill Bank Executives Wednesday

Wednesday, the Senate Banking Committee will hear from chief executives from eight of America’s largest banks in what is expected to be a combative hearing over whether or not stricter regulation is necessary to prevent failures similar to those of Signature Bank and Silicon Valley Bank earlier this year.The top executives at JPMorgan Chase, Bank of America, Citigroup, Goldman Sachs, Bank of New York Mellon, Morgan Stanley, State Street, and Wells Fargo will be in attendance Wednesday.In an announcement for the hearing, the chairman of the committee, Senator Brown, said that it’s the committee’s job “to hold them accountable to their workers, to their customers, and to the American people.”“This December we will bring the nation’s biggest banks before us for the third year in a row,” Mr. Brown said in a statement. “Wall Street megabanks continue to make record profits and to reward corporations that raise prices on Americans.”In recent months, the banking committee has made a bipartisan pivot to increase scrutiny of senior bank executives. After the failure of First Republic, Signature Bank, and Silicon Valley Bank, the committee passed a bill aimed at clawing back money paid to senior executives of the failed banks in a 21 to two vote. Senator Schumer has since promised to bring the bill to a vote on the Senate floor, though it hasn’t yet been scheduled.The president of a group that represents the eight executives that will attend the hearing, the Financial Services Forum, Kevin Fromer, tells the Sun that he expects the hearing to cover “everything their firms do to support their customers, the economy, and financial stability.”“I expect the hearing will include a focus on a recent regulatory proposal that would impose excessive requirements on an already well-capitalized group of banks, with negative impacts on borrowing, market liquidity, and economic growth,” Mr. Fromer says.Among other topics, one set of proposals being contemplated by the committee is called the “Basel III Endgame,” which is aimed at, in broad strokes, requiring more banks to keep more capital on hand in an effort to keep depositor’s assets more secure.While proponents of the changes say it will help prevent bank failure and subsequent government bailouts, opponents of the changes say it could discourage lending.Members of both parties have stepped up their scrutiny of banks in recent years, but it’s not clear that there is broad bipartisan support for the Basel III Endgame proposals.The committee’s ranking member, Senator Scott, expressed concerns that the proposed changes could be “burdensome” in a statement to Reuters.“I look forward to hearing directly from the businesses that will be impacted, and in turn, how these proposals will increase costs and limit access to credit for the Americans who need it most,” Mr. Scott said.

Senate Committee Expected To Grill Bank Executives Wednesday

Senate Committee Expected To Grill Bank Executives Wednesday

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