House Financial Services Committee Chairwoman Maxine Waters is seeking for her committee to have its own say in a major planned bank merger.
The California Democrat asked Federal Reserve Chairman Jerome Powell and Federal Deposit Insurance Corporation Chairwoman Jelena McWilliams Wednesday to defer approval of the proposed merger between BB&T Bank and SunTrust Bank until her committee can hold hearings on the subject.
If the merger goes through, it would result in the eighth largest bank in the country by total assets.
“[T]he proposed merger warrants serious scrutiny from Congress,” Waters wrote in a letter to the regulators. “This is especially true given the rubber-stamping bank merger applications receive from regulators demonstrated by the recent data regarding the Federal Reserve’s reviews.”
Waters raised the fear that the merger would harm community banks, black farmers, and lead to layoffs and branch closures.
The Fed and FDIC conducted two public hearings, one in Charlotte, N.C., the other in Atlanta, Ga., and are accepting public comments on the merger. If the merger receives regulatory approval and moves forward, the combined bank would control over $440 billion in total assets.
Congressional Democrats have accused bank regulators of rubber-stamping bank mergers, an accusation Powell has pushed back on.
In a 2018 letter to Sen. Elizabeth Warren, D-Mass., Powell acknowledged bank regulators rejected only three of the 3,819 bank merger applications it received between 2006 and the end of 2017. But Powell also noted that 503 additional applications were withdrawn by banks before the Fed made a formal decision on the application, implying that most or all of those applications would have been rejected.
Waters asked for a written response to her letter by May 15. The committee has a hearing on how regulators oversee large banks and other depository institutions scheduled for May 16.
