Today, Congresswoman Maxine Waters (D-CA), the top Democrat on the House Financial Services Committee, delivered the following opening statement at a Subcommittee hearing on Financial Institutions entitled, “Implementing Basel III: What’s the Fed’s Endgame?"
We certainly did receive a wake-up call this Spring with the failures of Silicon Valley Bank, Signature Bank, and First Republic. It became clear that we need to improve safety and soundness rules for large banks given the systemic risks they can pose.
To that end, regulators proposed to strengthen bank capital requirements for the largest banks to ensure that, among other things, they hold sufficient capital for unrealized losses in their securities portfolios.
I’m talking about the Federal Reserve, the Federal Deposit Insurance Corporation, the Office the of Comptroller of the Currency – they all are urging us to make sure that we do what is necessary to ensure the safety and soundness of our banks.
Their proposal would also implement an international agreement that the United States. made with other countries in 2017 that Trump’s regulators ignored while they prioritized deregulating big banks that could put our economy at risk.
Here’s the bottom line: we need stronger rules, not deregulation, to avoid future crises.