This week, lawmakers will question the top executives of JPMorgan, the Bank of America, Wells Fargo, Citigroup, and other significant U.S. retail banks on various issues, such as the status of the economy and their stances on divisive themes like fossil fuel lending or abortion.
According to bank officials, congressional staffers, and lobbyists, the CEOs will testify before the House Financial Services Committee as well as Senate Banking Committees on both Wednesday and Thursday, respectively, on payments fraud, increasing diversity, acquisitions, and access to bank branches.
The CEOs of the four biggest U.S. banks are on the list: Jamie Dimon of JPMorgan, Jane Fraser of Citi, Brian Moynihan of Bank of America, and Charles Scharf of Wells Fargo. Andy Cecere, the CEO of USBancorp (USB.N), William Demchak, the CEO of PNC Financial (PNC.N), and William Rogers, the CEO of Trust Financial, the largest regional lender in the nation, will also be there.
Even though such hearings rarely lead to legislative action, they are nonetheless dangerous for CEOs since they will be required to defend their banks on various fronts when lawmakers are eager to raise their profiles before the November elections.
Dimon as well as Senator Elizabeth Warren of the Democratic Party argued about overdraft fees during a hearing of a similar type last year. Tim Sloan, the former CEO of Wells Fargo, abruptly left his position in March 2019, two weeks after he stumbled during a House committee meeting regarding the bank’s efforts to address its regulatory issues.
The hearing is taking place in the midst of growing worries that Federal Reserve rate rises aimed to battle inflation could send the country into a recession. The U.S. economy was facing a “storm,” according to Jamie Dimon in June, but he did not know how catastrophic it would be.
The CEOs will likely be questioned by lawmakers on how consumers’ finances are doing and how the lenders want to help Americans as interest rates climb.
Senator Sherrod Brown, chair of the Senate Banking Committee, said in a statement that they will maintain holding the biggest banks in the country responsible so that Americans may keep more of their hard-earned savings at a time when they most need it.
The banks are confident that they can tell a successful story about how well they conducted during the COVID-19 pandemic while assisting in the distribution of billions of dollars-worth of aid, their ongoing contribution to the overall economy, and their initiatives to increase pay for rank-and-file employees, advance racial fairness in the communities they serve, and increase staff diversity.
The executives of the banks, lobbyists, and trade associations reportedly made this point during a flurry of recent private talks with influential politicians.
Lindsey Johnson, CEO of the Consumers Bankers Association, claimed there are several accomplishments that their banks may highlight to show how much they have done during the pandemic and up to the present day to help consumers, small firms, and the economy.
Democrats, such as Brown and Maxine Waters, the chair of the House Financial Services Committee, have taken a severe stance against the banking industry since the 2007–2009 financial crisis and are anticipated to maintain the pressure at the hearings.
According to copies provided, the committees have privately requested information from the CEOs regarding, among other things, their capital holdings, bank branch placements, employee wages, executive pay, measures to minimize carbon dioxide emissions, share buybacks, fair loans, and abortion coverage.
Hopefully, these measures will help ease the record-high inflation the U.S. is being plagued by.