Progressive Democrats in the House and Senate have introduced legislation demanding an array of new decision factors governing bank M&A transactions and new or even revised BHC activities. President Biden’s executive order demanding more competitive U.S. markets includes numerous bank-related provisions, but does so largely through requests of independent agencies such as the Federal Reserve to work with the Department of Justice to reduce bank consolidation and enhance community service. This legislation backs up these goals with binding requirements that dramatically alter the public-interest, financial, and competitive analyses on which M&A or BHC activities have long been assessed. Many more acquisitions, especially by or among large banks, would almost surely be rejected and the process might also become so public as to undermine the confidentiality essential to initial M&A agreement.
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