Republicans are angry about the increasing number of megabanks cutting off financing for gun manufacturers, and let those banks’ supervisor hear about it Thursday.
“We don’t need red banks and blue banks,” John Kennedy, R-La., told Federal Reserve governor Randal Quarles at a Senate Banking Committee hearing.
“We need banks that are safe and sound and honest, and that appreciate it when the American taxpayer puts up billions and billions of dollars of their hard-earned money to keep these banks from going belly-up,” Kennedy added.
Kennedy and other Republicans pressed Quarles, the vice chairman of supervision at the central bank, to weigh in on the pressure that banks are facing to stop doing business with some gun dealers.
Bank of America said this spring that it would stop lending to gun manufacturers who make AR-15s, the rifle used in the school massacre in Parkland, Fla. Citigroup has said it won’t do business with companies that sell guns to people who haven’t passed background checks or are under 21.
Kennedy accused the firms of making policy for the country, “supplanting the United States Congress.”
Idaho Republican Mike Crapo, the committee’s chairman, began the hearing by referencing the possibility that New York State’s regulators might warn banks against doing business with the NRA or the gun industry on the grounds that it could damage their reputations. That would be an excuse, Crapo said, for stopping unfavored business.
Quarles responded that lending to gun firms doesn’t reflect on banks’ safety and soundness either way.
“Those issues are really outside of our remit as regulators of the system at the Federal Reserve,” he said.
