Financial Services Committee Chair Seeks Moratorium On Large Bank Mergers And Acquisitions – Finance and Banking

United States:

Financial services committee chairman proposes moratorium on mergers and acquisitions of large banks

December 19, 2021

Cadwalader, Wickersham & Taft LLP

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Maxine Waters (D-CA), Chair of the House Financial Services Committee, urged the Federal Reserve Board (“FRB”), the FDIC, and the OCC to “impose a moratorium on the approval of any major merger and acquisition proposals that may arise conducts a banking business “. Companies with total assets of more than $ 100 billion. “

In a letter to regulators, Chairman Waters urged the authorities to require public hearings for all major bank mergers and acquisitions. In addition, Ms. Waters requested that bank merger and acquisition requests be reviewed by other regulators such as the Financial Stability Oversight Council and the CFPB to ensure that any transaction does not add risk to consumers or jeopardize the stability of the financial system.

Ms. Waters stated that the current regulations add to lax oversight by both the DOJ and the Federal Reserve, which have not contested a transaction since 2003. Ms. Waters called for several policy changes, including:

  • Lowering concentration thresholds for greater control of fusions;
  • stricter assessment of the risks to financial stability; and
  • greater consideration of potential conflicts of interest.

Ms. Waters said that temporarily withholding permits pending such a review “will help ensure that a regulatory landscape is in place that … fosters healthy, dynamic and competitive banking markets” “.

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