- Nomination of Jerome Powell: Jerome Powell’s nomination was favorably reported out of the Senate Banking Committee by a vote of 22-1. The lone dissenter was Senator Elizabeth Warren (D-Mass.)
- S.2155, the Economic Growth, Regulatory Relief, and Consumer Protection Act: This bipartisan banking relief bill was favorably reported out of Committee by a vote of 16-7. The Managers Amendment (Crapo #2) was the only amendment approved during a lengthy markup. The Committee also considered many amendments (all offered by the minority) though all these amendments were voted down.
Nomination of Jerome Powell
Chairman Mike Crapo (R-Idaho)
Crapo briefly introduced the candidacy of Powell to serve as Federal Reserve Chairman, and made a few brief comments in support of Powell’s nomination.
Ranking Member Sherrod Brown (D-Ohio)
In his opening statement, Brown said he was “disappointed” that Janet Yellen was not re-nominated to serve as Chairman of the Federal Reserve, but conceded that Powell’s Chairmanship would provide average Americans the “best chance” of economic growth. He praised Powell’s support for present interest rate policy, and compared Powell favorably to current Federal Reserve Governor Randy Quarles while criticizing the Trump Administration’s tack on financial regulation generally.
Senator Elizabeth Warren (D-Mass.)
Warren also gave an opening statement, during which she criticized Powell for supporting the Department of the Treasury’s recent report on bank regulations, and was particularly critical of several statements he made during his confirmation hearing. She described his belief that there are “no banks in America are too big to fail” as misguided.
The nomination was favorably reported to the Senate by a vote of 22-1.
Opening Statements –S.2155, the Economic Growth, Regulatory Relief, and Consumer Protection Act
Chairman Mike Crapo (R-Idaho)
In his opening statement, Crapo discussed the bipartisan outreach conducted by the Senate Banking Committee in the spring of 2016, to gather legislative proposals for “right-sizing” financial services regulations to improve economic growth. Crapo also discussed the hearings conducted by the Committee throughout the year that dealt heavily with how best to tailor regulations for smaller financial institutions. Crapo then provided a brief overview of S.2155, noting provisions to reduce the regulatory burden on community banks and credit unions (especially in the mortgage lending space) and provisions to simplify the capital requirements for those institutions. Crapo also noted several consumer protection provisions, and the new systemically-important financial institution (SIFI) threshold requirements. Crapo said the bill has broad bipartisan support and was negotiated in good faith.
Ranking Member Sherrod Brown (D-Ohio)
Brown criticized S.2155, saying it makes large changes to bank regulation that will advantage those institutions, but that the bill has “nothing” to help Americans with student loan and mortgage debt, or to help Americans who are otherwise struggling. He criticized the process that led to the creation of the bill, as well as the Trump Administration’s recent appointment of Mick Mulvaney as Acting Director of the Consumer Financial Protection Bureau (CFPB). He described the bill as “Christmas for the C-suite” and noted opposition to the bill from several consumer advocate organizations.
Other Committee Members
13 other members of the Committee gave opening statements about S.2155. Sens. Heidi Heitkamp (D-N.D.) Joe Donnelly (D-Ind.) Mark Warner (D-Va.) and John Tester (D-Mont.) joined numerous Republicans and spoke in favor of the legislation. These Senators generally defended the bill on process grounds, and said that while they would have liked the bill to be different in certain ways, they supported the legislation because it would lighten the burden on community financial institutions while leaving the Dodd-Frank Act (DFA) requirements on large institutions intact. These Democrats also praised the bill’s consumer protection provisions, and Warner defended the bill’s proposed new SIFI-designation regime. Warner and Tester also said they would vote against amendments to the bill that are not offered on a bipartisan, negotiated basis (they were joined on almost amendment votes by several of their Democratic colleagues).
Republicans on the Committee spoke in favor of the bill, though several said they would have liked a more aggressive set of deregulatory provisions. Senator Pat Toomey (R-Pa.) said that he believed the bill is a “mostly modest but constructive” step to lighten financial regulations, and while he said he would support the bill, he criticized the new SIFI-designation threshold (automatic at $250 billion in assets) as an arbitrary level that would create a “competitive imbalance” between fundamentally similar institutions (the Senator said an activities-based threshold would be a better standard). Toomey also expressed an interest in passing legislation that addresses the liquidity coverage ratio (LCR) and the advanced approaches to capital framework.
Sens. Warren, Brian Schatz (D-Hawaii), Bob Menendez (D-N.J.) Chris Van Hollen (D-Md.) and Catherine Cortez Masto (D-Nev.) were more critical of the bill. Warren criticized her Democratic colleagues for deciding to vote down amendments and criticized what she called a “closed-door” negotiation process. Menendez said that while reducing the regulatory burdens on community financial institutions was important, he had concerns that the legislation would limit regulators ability to monitor risk and business practices, and that he would introduce amendments that he believed would improve the bill. Van Hollen said he supported the community bank relief and SIFI-designation provisions, but that the consumer protection provisions needed to go farther. Cortez Masto expressed disappointment that minority amendments would be voted down.
Consideration of S.2155 and amendments
Crapo Amendment #2 (Managers Amendment)
Crapo began by offering Crapo #2, the Managers Amendment, which made technical changes to the bill, added several amendments to the bill, and introduced new provisions (negotiated with Sens. Tom Carper (D-Del.) and Chris Coons (D-Del.)) that would provide additional protections to active-duty military. Heitkamp endorsed the Amendment and praised the military provisions. Brown and Warren were critical of the Managers Amendment on content and process grounds.
The Managers amendment was approved by a vote of 16 – 7.
The Committee then turned to amendments offered by the minority (the majority offered no amendments). The Committee considered many amendments, but voted down all amendments other than the aforementioned Managers Amendment (several amendments did not receive votes because they were withdrawn).
A full list of amendments considered can be found below. The numbers listed are from the official Committee amendment roster (which will be circulated with this hearing summary).
Cortez Masto #73
Cortez Masto #70
Cortez Masto #69
Van Hollen #85
Cortez Masto #71
Cortez Masto #72
Cortez Masto #75
The bill S.2155, as amended, was favorably reported to the Senate by a vote of 16-7
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