Warren Requests Information from Fed, DOJ on Bank Merger Reviews
Wave of Mergers Expected as Result of Bank Deregulation Bill; Senator Raises Antitrust Concerns
Washington, DC - United States Senator Elizabeth Warren (D-Mass.) today sent a letter to Federal Reserve Chairman Jerome Powell and Attorney General Jeff Sessions requesting information on how the Federal Reserve Board of Governors and Department of Justice (DOJ) Antitrust Division have reviewed past bank mergers and how the agencies intend to preserve competition and protect financial stability when evaluating future mergers. The senator's letter comes ahead of an anticipated wave of bank mergers if the Senate's recently passed bank deregulation bill (S.2155) becomes law.
The Federal Reserve and DOJ Antitrust Division share responsibility for reviewing the competitive effects of bank mergers and acquisitions. Last month, the Senate passed S.2155, which would reduce federal oversight of banks with between $50 billion and $250 billion in assets. Citing reports by industry observers that deregulating this category of banks will produce more mergers and consolidation in the banking industry, Senator Warren expressed concern about the impact of these potential mergers on consumers.
"Large regional banks compete with community banks for customers hoping to open checking accounts and small businesses looking for a loan to expand," wrote Senator Warren. "I'm concerned about the negative impact of increased consolidation caused by S. 2155 on community banks and on customers who benefit from more competition for their business."
Noting that the Federal Reserve and DOJ Antitrust Division are likely to review an increased number of mergers if S.2155 becomes law, the senator's letter asked a series of questions in order to understand the agencies' past practices in reviewing bank mergers and what evaluations they will conduct should additional mergers come before them for review.
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