Less than a decade after being blamed for fueling the worst financial crisis since the Great Depression, banks are winning again in Washington.
The rebound for the lenders has been so remarkable that Republicans and Democrats in Congress are pushing to scale back financial regulations imposed in the wake of the meltdown — one of the few areas where the two parties agree.
President Donald Trump, who once vowed not to let Wall Street “get away with murder,” has dropped the demonizing campaign rhetoric and recruited industry veterans to his administration. His Treasury Department has drawn up a series of recommendations for trimming the post-crisis rule book. Even the Federal Reserve, the top banking regulator, is working to relax safeguards.
Lawmakers and regulators are rethinking policies including loosening mortgage protections, curtailing so-called stress tests that gauge how banks would fare during economic turmoil, and simplifying capital requirements for smaller lenders. Continue reading “How the banks won over Washington again”
Two Senate Republicans joined with Democrats on Tuesday to block the confirmation of President Donald Trump’s pick to head the Export-Import Bank, a rare rejection of a Trump appointee by members of his own party and prominent business groups.
The outcome had been building for months after the White House and the nominee, former Rep. Scott Garrett (R-N.J.), failed to win over lawmakers who were suspicious of why Garrett would want to lead an agency that he tried to shut down when he served in Congress.
Garrett went down in a 13-10 vote by the Senate Banking Committee. Sens. Mike Rounds (R-S.D.) and Tim Scott (R-S.C.) voted against him.
“We need to both reform the Export-Import Bank and ensure it continues to function as an important tool for American businesses," Scott said. "Given Mr. Garrett’s long history opposing the Ex-Im Bank, I believe it Continue reading “GOP defectors block Trump nominee to head Ex-Im Bank”
Scott Garrett, President Donald Trump’s pick to lead the Export-Import Bank, will likely be blocked by bipartisan opposition after he struggled to convince lawmakers that he should run an agency he once tried to kill in Congress.
Garrett’s fate was all but sealed Tuesday when Sen. Mike Rounds (R-S.D.) said he would oppose the former congressman’s confirmation when it comes up for a vote at the Senate Banking Committee on Dec. 19. The panel has 12 Republicans and 11 Democrats, and all the Democrats are expected to oppose Garrett.
"I believe him to be a proponent of the abolition of the bank rather than a reformer of the bank," Rounds told POLITICO. "I’m looking for reformers, not abolitionists."
Rounds had raised concerns that small contractors in his state could be hurt if their larger customers lost access to financing. U.S. companies rely on the agency to Continue reading “Trump Ex-Im Bank nominee will likely be blocked”
President Donald Trump on Wednesday nominated economist Marvin Goodfriend to serve as a Federal Reserve governor, in his latest move to reshape the central bank.
Goodfriend, a professor at Carnegie Mellon University, has been critical of the Fed’s response to the 2008 financial crisis and has said its monetary policy moves should be more open to scrutiny by Congress.
One leading lawmaker who has sought to rein in the Fed, House Financial Services Chairman Jeb Hensarling (R-Texas), praised Goodfriend as an "impeccable conservative."
Earlier this month, Trump tapped Fed Gov. Jerome Powell to succeed Janet Yellen as chair, and he previously named Randal Quarles as the lead official responsible for overseeing the banking industry.
The Senate confirmed Quarles to the post last month and is now vetting Powell’s nomination.
Goodfriend’s appointment had been expected for several months.
In October, a coalition of progressive groups called on senators to oppose Continue reading “Trump nominates Fed critic to board”
A Republican-led proposal to roll back banking regulations is drawing support across party lines in the Senate, building momentum for the biggest rewrite of financial rules in years and setting the stage for a showdown among Democrats.
In an unusual development, nine Democrats — enough needed to pass the bill with Republicans in the months to come — are co-sponsoring the package, which would scale back rules for many banks.
The legislation was negotiated by Senate Banking Chairman Mike Crapo (R-Idaho) with a group of red-state Democrats who have been working for years to ease regulations that they say are stifling lending.
They are pushing ahead despite opposition from liberal lawmakers, including two prominent finance industry critics — Sen. Sherrod Brown of Ohio, the top Democrat on the Banking Committee, and Sen. Elizabeth Warren of Massachusetts, who has attracted a massive following by attacking Wall Street. Brown and Warren argue Continue reading “Democrats split over support for GOP-led bank bill”
House Republicans overcame bipartisan opposition Tuesday to pass a bill that would reauthorize and overhaul the National Flood Insurance Program, which has strained to pay out billions of dollars to policyholders after this year’s run of devastating hurricanes.
The House passed the bill in a 237-189 vote following months of debate and dealmaking over how much to scale back the primary tool that millions of homeowners rely on to protect themselves from the financial risks of flooding.
The bill would reauthorize the NFIP for five years and enact several operational changes championed by Financial Services Chairman Jeb Hensarling (R-Texas), the fiscal conservative who led an effort to pare back the program as part of the reauthorization bill.
During the process, Hensarling clashed with influential business groups and coastal Republicans who argued that his committee’s proposals threatened homeowners and local economies.
After agreeing to a series of concessions going back to Continue reading “House passes flood insurance renewal in wake of massive storms”
A group of senators on Monday rolled out a rare, bipartisan agreement years in the making that would relax a number of banking regulations enacted after the 2008 financial crisis.
The deal was driven by Senate Banking Chairman Mike Crapo (R-Idaho) and a handful of red-state Democrats who have long argued that the rules were stifling lending for their rural constituents. The same Democrats are facing tough reelection campaigns next year.
The compromise would ease regulations on small, community banks as well as several larger lenders that have been subject to stricter oversight because they have more than $50 billion in assets.
The release of the deal immediately drove a wedge between moderate Democrats and others in the party who have resisted making significant changes to the post-financial crisis regulatory regime. Sen. Sherrod Brown of Ohio, the top Democrat on the Banking Committee, said he opposed the proposal because it Continue reading “Senators reach rare bipartisan deal to ease banking rules”