Today’s Senate Banking hearing on bank supervision did not include FRB Vice Chairman Quarles, who came before the panel for withering criticism earlier this year (see Client Report REFORM206). Acting Comptroller Hsu, FDIC Chair McWilliams, and NCUA Chairman Harper received a considerably warmer welcome from Democrats, although Ranking Member Toomey (R-PA) blasted the OCC for what he called politicization of bank supervision and urged all the agencies to leave the CRA rulebook as is. Chairman Brown (D-OH) attacked bank regulation prior to the arrival of the Biden team, by inference continuing his criticism of Chairman Powell’s regulatory approach (see Client Report FEDERALRESERVE63). Under questioning, Mr. Hsu announced that his agency is reviewing overdraft fees; while he did not say in which context, it would appear to be with an eye on the extent to which earnings reliance on them may be unsound, but reputational-risk considerations may also be renewed.
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