Senate Banking Committee Approves SEC, FHFA, CEA, and NCUA Nominees
On July 18, the Senate Banking committee approved via voice vote the nominations of Ms. Kara Stein and Dr. Michael Piwowar to be Commissioners of Securities and Exchange Commission (SEC), of Mr. Richard Metsger to be a Member of the National Credit Union Association (NCUA), and of Dr. Jason Furman to serve as Chairman of the Council of Economic Advisors (CEA). The Committee also approved by voice vote an extension of current SEC Chairman Mary Jo White’s term into 2019. The only nomination that required a roll call vote was that of Rep. Mel Watt (D-NC) to be Director of the Federal Housing Finance Administration (FHFA). His nomination was narrowly approved by a 12-10 party line vote. All nominees will now be reported favorably to the Senate for consideration.
Senate Confirms Richard Cordray as Director of Consumer Financial Protection Bureau (CFPB)
Under threat of using the “nuclear” option by Senate Majority Leader Harry Reid (D-NV), the Senate was able to reach an agreement that would allow Mr. Cordray’s nomination to be Director of the CFPB to come up for a vote. Previously, Senate Republicans vowed to block any of President Obama’s nominees, and the administration was forced to surreptitiously appoint Mr. Cordray as Director during a Congressional recess in January 2012. The validity of this recess appointment, and therefore the actions of the CFPB, were in dispute until July 16, when Mr. Cordray’s nomination was officially confirmed in the Senate by a vote of 66-34.
This Week’s Hearings:
- Tuesday, July 23: The Senate Banking Subcommittee on Financial Institutions and Consumer Protection will hold a hearing titled, “Examining Financial Holding Companies: Should Banks Control Power Plants, Warehouses, and Oil Refineries?”
- Tuesday, July 23: The Senate Banking Subcommittee on Securities, Insurance, and Investment will hold a hearing titled, “Creating a Housing Finance System Built to Last: Ensuring Access for Community Institutions.”
- Tuesday, July 23: The House Agriculture Subcommittee on General Farm Commodities and Risk Management will hold the second in a series of hearings on reauthorization of the CFTC titled, “Future of the CFTC: Commission Perspectives.” CFTC Commissioners Mark Wetjen and Scott O’Malia will testify.
- Tuesday, July 23: The House Financial Services Committee will hold a markup of the Protecting American Taxpayers and Homeowners (PATH) Act of 2013.
- Wednesday, July 24: The Senate Banking Committee will hold a hearing on The Federal Housing Administration (FHA) Solvency Act of 2013. Department of Housing and Urban Development Assistant Secretary Carol Galante will testify.
- Wednesday, July 24: The Senate Special Aging Committee will hold a hearing titled, “Payday Loans: Short-term Solution or Long-term Problem?”
- Wednesday, July 24: The House Agriculture Subcommittee on General Farm Commodities and Risk Management will hold the third in a series of hearings on CFTC reauthorization titled, “Future of the CFTC: End User Perspectives.”
Executive Branch Activity
SEC to Hold Meeting of Dodd-Frank Investor Advisory Committee
On Thursday, July 25, the SEC will hold a meeting of the Dodd-Frank Investor Advisory Committee. The agenda for the meeting includes: Investor as Owner Subcommittee recommendation regarding data tagging; Investor as Owner Subcommittee recommendation regarding the use of universal proxy ballots; and subcommittee reports.
Federal Reserve Chairman Ben Bernanke Testifies Before House and Senate Committees
On July 17 and July 18, Federal Reserve Chairman Ben Bernanke testified before the House Financial Services Committee and the Senate Banking Committee to deliver the Federal Reserve’s Semi-Annual Monetary Report to Congress. During his testimony he made several remarks of note. Chairman Bernanke repeatedly cited spending cuts and tax increases as a near-term drag on economic growth and warned that another debt-ceiling showdown could kill the economy’s fragile growth momentum. The chairman also stated that new measures, including legislation, may merit consideration if concerns about “too big to fail” banks are not adequately addressed by the end of 2014. He also stated that the Federal Reserve was considering plans to disclose details to borrowers whose foreclosure files were examined as part the independent foreclosure review that was nixed earlier this year in favor of a $9.3 billion settlement with banks.
FSOC Designates Systemically Important Institutions
Last week, the Financial Stability Oversight Council (FSOC) designated AIG, GE Capital, and Prudential as “systemically important financial institutions” (SIFIs), making them subject to greater oversight by the Federal Reserve. AIG and GE Capital accepted the designation, but Prudential plans to appeal it. On July 16, MetLife announced it was in the final stages of consideration for SIFI designation by the FSOC and decried the possible designation as inappropriate.
FSB Designates G-SIIs and IAIS Releases Policy Measures for Designated Companies
On July 17, the FSB released its initial designations for systemically important insurers (G-SIIs). The insurers designated are: Prudential Insurance, MetLife, AIG, Allianz SE, Assicurazioni Generali S.p.A., Aviva plc, AXA S.A., Inc., Ping An Insurance Group Company of China, Ltd., and Prudential Financial, Inc. Additionally, the International Association of Insurance Supervisors released proposed final policy measures and assessment methodologies for G-SIIs.