December 16, 2019

Warren and García Press Regulators For Evidence Supporting Their Approval of the BB&T-Suntrust Merger

"The creation of a new bank with almost $450 billion worth of assets has broad implications for working families, their communities and U.S. financial system, and consumers deserve to know exactly how these decisions are made by your agency"; Warren and García introduced the bicameral Bank Merger Review Modernization Act earlier this month

Text of Letter to FDIC (PDF) | Text of Letter to Fed (PDF)

Senator Warren's QFRs for Fed Vice Chairman Randal Quarles (PDF)

Senator Warren's QFRs for FDIC Chairman Jelena McWilliams (PDF)

Washington, DC - United States Senator Elizabeth Warren (D-Mass.), member of the Senate Banking Committee, and Representative Jesús "Chuy" García (D-Ill.), member of the House of Representatives Committee on Financial Services, on Friday sent a letter to the Federal Reserve (Fed) and the Federal Deposit Insurance Corporation (FDIC) to raise new questions about their agencies' rubber-stamp approval of the $450 billion BB&T-Suntrust merger. The merger, finalized on December 6, 2019, created Truist Financial Corporation (Truist), the sixth largest bank in the United States and the first new big "Too Big To Fail" bank since the financial crisis.

"The creation of a new bank with almost $450 billion worth of assets has broad implications for working families, their communities and U.S. financial system, and consumers deserve to know exactly how these decisions are made by your agency," the lawmakers wrote in their letter.

Senator Warren and Representative García are the lead sponsors of the bicameral Bank Merger Review Modernization Act, legislation that would put an end to the rubber stamping of bank merger applications, restrict harmful consolidation in the banking industry, and protect consumers and the financial system from Too Big to Fail institutions.

The lawmakers' letter asked regulators to respond to their questions no later than December 27, 2019 from the Fed and no later than December 30, 2019 from the FDIC.

Today Senator Warren also released questions for the hearing record submitted to the Banking Committee in follow up to financial regulators' testimony at a December 5th hearing, "Oversight of Financial Regulators." In addition to raising questions about the BB&T-SunTrust merger, Senator Warren questioned regulators about their oversight of the Community Reinvestment Act, the impact of climate change on financial stability, and the "valid-when-made" doctrine.

Senator Warren has a strong record of questioning Too Big to Fail banks and the regulators who enable them:

  • Senator Elizabeth Warren, the late Senator John McCain (R-Ariz.), Senator Maria Cantwell (D-Wash.), and Senator Angus King (I-Maine) re-introduced the 21st Century Glass-Steagall Act, a modern version of the Banking Act of 1933 (Glass-Steagall) that protects American taxpayers, helps community banks and credit unions compete, and decreases the likelihood of future financial crises. The group of lawmakers first introduced the bill in 2013.
  • In January 2018, Senator Warren delivered a speech on the Senate floor opposing the nomination of Jerome Powell to serve as Chairman of the Fed. In her speech, Senator Warren expressed concern that Mr. Powell would weaken financial regulations rather than strengthen them, and urged her colleagues to reject his nomination. 
  • In March 2018, Senator Warren introduced the Ending Too Big to Jail Act to hold big bank executives accountable when the banks they lead break the law.
  • In response to a letter Senator Warren wrote in April 2018 to Chairman Powell and Attorney General Jeff Sessions in the wake of the passage of the Bank Lobbyist Act (Public Law No: 115-174), which the senator correctly assumed would catalyze mergers among large banks, Chairman Powell admitted that no merger applications had been declined since 2006, though a handful had been withdrawn. Chairman Powell's letter also revealed that in considering a merger application, the Fed largely looks at whether the merger would create monopolies for the merged bank in any market.
  • In February 2019, following the announcement of the merger proposal between BB&T and SunTrust, Senator Warren wrote to Chairman Powell asking about the proposed merger's effect on consumers.
  • Senator Warren also raised questions with Chairman Powell during a February 2019 Senate Banking, Housing, and Urban Affairs Committee hearing about closed-door discussions that take place before a merger application is filed. As a result, the Fed announced that it would hold two public forums to get public input on the BB&T and SunTrust merger.

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