News

Financial Services Roundup

March 26, 2024

While the government funding deadline has dominated headlines, a flurry of regulator and committee activity focused on banking and financial services.

Bank Mergers: The Federal Deposit Insurance Corp. on Thursday moved to scrutinize bank mergers more closely, proposing changes that would raise the bar for approving such transactions, especially where the combined banks have more than $100 billion in assets.

• The proposal, which calls for the FDIC to take a more expansive approach to evaluating how a bank merger would affect competition, was approved in a 3-2 vote along party lines.
• CFPB Director Rohit Chopra on Thursday argued that Congress should make it so that a handful of megabanks can’t acquire failing lenders unless there are no other options.

SEC and Artificial Intelligence: SEC Chair Gary Gensler on Tuesday said a growing dependence on AI could pose a danger to the U.S. financial system, adding that regulators need to rethink their siloed approach to rulemaking to minimize the risk:

“I would be quite surprised if in the next 10 or 20 years a financial crisis happens and there wasn't somewhere in the mix some overreliance on one single data set or single base model somewhere.”

On the Hill, the House Financial Services Committee held a hearing on Thursday to discuss the risks of ceding authority over American financial regulation to global governance bodies.

• Similar to previous hearings on the topic, lawmakers discussed transparency at the Basel Committee, the Basel III proposal’s effect on global competition, and regulators’ work to better understand climate-related financial risks.
• Subcommittee hearings included a focus on SEC overreach (more in the above story), one on homebuyers, and a field hearing on the SEC climate rule.
• In HFSC news, Rep. French Hill (R-AR) officially announced on Sunday that he will run to be the next top Republican on the Financial Services Committee. He’s set to face off against Reps. Andy Barr (R-KY) and Bill Huizenga (R-MI), and potentially others.

Stablecoin Progress: Chair McHenry said Tuesday that he and Ranking Member Waters (D-CA) would be able to secure passage of stablecoin legislation if they had a legislative vehicle.

News Archive