Watch Live: Big Bank CEOs Face ‘Mad Maxine’ In “Holding Megabanks Accountable” Hearing
Lawmakers on Capitol Hill are set to grill the CEOs of the largest consumer banks Wednesday morning on several hot-button topics, including consumer protection and compliance issues, mergers and acquisitions, and issues relating to the public interest, among other topics.
In testimony before the House of Representatives Financial Services Committee will be JPMorgan Chase & Co’s Jamie Dimon, Wells Fargo’s Charles Scharf, Bank of America’s Brian Moynihan, and Citigroup’s Jane Fraser, the heads of the top four largest banks. And US Bancorp CEO Andy Cecere, PNC Financial CEO William Demchak, and Truist’s Bill Rogers, who are the country’s largest regional lenders.
The House Financial Services Committee hearing is led by Chair Maxine Waters, D-Calif, who will get the first crack at the bankers on Wednesday. The second round of hearings will be held Thursday and led by Chair Sherrod Brown, D-Ohio.
Hearings with top banking heads seldomly result in legislative action. But this one comes ahead of the November midterm elections in which some lawmakers could be very outspoken to boost their political campaigns. Lawmakers on the bank-oversight committee will question the executives on high inflation and soaring interest rates:
“We will continue to hold the nation’s biggest banks accountable so that Americans can keep more of their hard-earned money—at a time that they need it most,” Sen. Sherrod Brown (D-Ohio) said in a written statement. Brown is chairman of the Senate Banking Committee.
Some Democratic lawmakers will press the executives on racial equity, climate change, overdraft fees, mergers with other banks, and the economy’s overall health.
Meanwhile, Republican lawmakers will question executives on the banking industry’s increasingly liberal leanings on the environment and social issues:
“Americans deserve to hear how these banks will support their customers through troubling economic headwinds…instead of far-left talking points to appease progressive activists,” said North Carolina Rep. Patrick McHenry, the ranking GOP member on the House financial-services panel, in a written statement.
Reuters provided a quick summary of biographies of the CEOs who will testify and part of their prepared statements:
Jamie Dimon, the outspoken leader of the largest US bank, is expected to defend the industry and field tricky questions after sparring with lawmakers in past hearings. Last year, he had a contentious exchange with Senator Elizabeth Warren over Chase’s overdraft fees. In prepared testimony ahead of the 2022 hearings, Dimon criticized strict capital requirements for large banks as a hindrance on lending and “bad for America.”
Dimon took the helm at JPMorgan in 2006 and is the longest tenured of all the CEOs who will testify. He’s not shy about weighing in on policy topics such as infrastructure and education, which are cited in his annual letter to shareholders.
Bank Of America
Brian Moynihan, who became Bank of America’s CEO in 2010, rebuilt the company after it almost collapsed under the weight of its troubled crisis-era acquisitions of Wall Street giant Merrill Lynch and mortgage lender Countrywide. In his prepared testimony, Moynihan touted the firm’s focus on “responsible growth” as critical to its stability and strength.
While steering BofA’s turnaround efforts, Moynihan also became a leading proponent of so-called stakeholder capitalism, which combines business interests with societal goals.
Jane Fraser, the first woman to lead a major Wall Street bank, was appointed in March 2021. She inherited a slew of problems from her predecessor, including demands by regulators to clean up Citigroup’s internal controls. She has announced plans to exit Russia in a bid to pare down risky assets and cull consumer businesses in 13 other countries to focus on multinational companies and wealthy clients.
In her prepared testimony, Fraser said the bank had made “significant progress” in divesting from those areas, while supporting institutional clients.
Charles Scharf took the reins at Wells Fargo in 2019, tasked with resolving punishments meted by regulators over the bank’s fake accounts scandal, including an asset cap imposed by the Federal Reserve in 2018. Scharf plans to tell lawmakers he expects it will take several years to ultimately rectify those issues, but that he is confident his team is well positioned to do so, according to his prepared testimony.
Andy Cecere, who has run US Bancorp since 2017, presided over its $8 billion deal to buy MUFG Union Bank, which was announced last year. The transaction is still awaiting regulatory approval and comes as government officials are looking more closely at bank mergers. In his testimony, Cecere said the merger would provide new tools and products to customers, and boost competition along the West Coast where MUFG Union Bank operated by establishing a “new, formidable regional bank competitor.”
US Bancorp is currently the fifth largest bank in the US with $582 billion in assets, and the largest bank outside of the “globally systemic” firms.
PNC Financial Services
Since 2013, William Demchak has been CEO of PNC, which operates in 27 states and is headquartered in Pittsburgh. Demchak described the $534 billion bank as a “Main Street banking organization” that focuses on traditional products and endeavors to embed itself in local communities, according to his prepared testimony.
William Rogers Jr., said US consumers and businesses were in “good shape” at a banking conference in New York earlier this month. He took charge of Truist in September last year as part of a planned transition after the merger of BB&T Corporation and SunTrust Banks was completed in 2019. The deal vaulted the firm to seventh largest in the country with $532 billion in assets.
Rogers describes the bank as “purpose-driven” in his prepared testimony, and highlighted efforts to boost investment in lower income and majority-minority communities.
Watch: Holding Megabanks Accountable: Oversight of America’s Largest Consumer Facing Banks (hearing begins at 1000ET)
Wed, 09/21/2022 – 09:40