Today, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Committee on Financial Services, released the following statement on the Federal Deposit Insurance Corporation (FDIC) Chairman’s efforts to block a majority of the FDIC Board from updating bank merger review processes that would protect working families across this country from being denied access to capital and banking services.
“As I wrote last week, and at a time when a wave of megamergers is making our banking markets less competitive, I welcome the long-overdue steps by banking regulators to finally update their bank merger review procedures. However, I am deeply concerned by recent actions taken by the FDIC Chairman to—in an unilateral, unprecedented, and potentially unlawful move—attempt to thwart the will of the majority of the FDIC to seek public input on this matter. I am calling on Chairman Jelena McWilliams to explain her legal authority for attempting to veto this action approved by a majority of the FDIC Board, including by apparently directing agency staff to issue a public statement disavowing the sensible request for information from the public, and subsequently rejecting a motion to include the notational vote authorizing the request in the minutes at this week’s board meeting.
“Last week, I called on the FDIC, Office of the Comptroller of the Currency (OCC), and Federal Reserve to halt approval of large bank merger applications until an updated bank merger review framework is finalized. In response to President Biden’s executive order promoting competition that I previously called for, Federal Reserve Chair Powell indicated that he was working with other banking regulators and the Department of Justice to strengthen the bank merger review framework, which followed Fed Governor Michelle Bowman, among others, expressing the importance of doing so to better reflect the competitive landscape small banks face. I urge Chairman McWilliams to promptly reconsider her obstruction and join this bipartisan effort to update outdated bank merger review procedures that don’t even reflect requirements under current law.
“Moreover, following a Trump-era deregulatory rollback of Dodd-Frank in 2018, we have seen an acceleration of proposed and approved mergers in recent years creating larger banks—including mergers of BB&T with SunTrust, First Citizens with CIT, and U.S. Bank with MUFG Union Bank. If regulators continue to rubber stamp these deals as they have in the past, it may not be long before community financial institutions will be wiped out and consumers will be left with a small handful of megabanks to do business with. Testimony before the Committee, along with extensive data and research shows that bank consolidation is harmful to workers, consumers, and communities, and that smaller, mission-driven, and diverse community financial institutions do the best job of meeting the needs of small businesses and communities of color. These communities need access to financial services in order to recover from the pandemic, and Chairman McWilliams should not stand in the way of that recovery.”
On February 7, 2019, Chairwoman Waters issued a statement on the proposed merger of SunTrust and BB&T.
On July 24, 2019, Chairwoman Waters convened a full Committee hearing entitled, “The Next Megabank? Examining the Proposed Merger of SunTrust and BB&T.”
On November 19, 2019, Chairwoman Waters issued a statement on regulators’ approval of the merger of SunTrust and BB&T.
On November 18, 2020, Chairwoman Waters issued a statement on the proposed acquisition of BBVA USA by PNC.
On December 4, 2020, Chairwoman Waters sent a letter to then President-Elect Joseph R. Biden urging his Administration to strengthen the merger and acquisition and anti-trust review processes.
On May 19, 2021, Chairwoman Waters expressed alarm at a recent report that the Fed was rolling back bank merger review during her opening statement at a full Committee hearing entitled, “Oversight of Prudential Regulators: Ensuring the Safety, Soundness, Diversity, and Accountability of Depository Institutions.”
On July 14, 2021, Chairwoman Waters encouraged Chair Powell to strengthen the Fed’s “outdated approach to bank mergers” during her opening statement at a full Committee hearing entitled, “Monetary Policy and the State of the Economy.”
On July 15, 2021, Chairwoman Waters sent a letter to Federal Reserve Chair Jerome Powell supporting President Biden’s executive order on competition, and encouraging him to work with the Justice Department and other banking agencies to update and strengthen their process for reviewing bank mergers.
On September 29, 2021, the Subcommittee on Consumer Protection and Financial Institutions held a hearing entitled, “The Future of Banking: How Consolidation, Nonbank Competition, and Technology are Reshaping the Banking System.”
On December 10, 2021, Chairwoman Waters sent a letter to the Fed, FDIC, and OCC to Halt Mergers and Acquisitions Over $100 Billion.