Democratic senators urge Fed to review bank merger policy

Senate Banking Committee Chairman Sherrod Brown (D-Ohio) and three Democratic committee members today urged the Federal Reserve to review and reconsider its approach to large bank mergers, including the agency’s framework for evaluating a merger’s impact on financial stability.

In their letter, the senators noted the Dodd‑Frank Act included an amendment to the Bank Merger Act that mandated federal banking regulators consider financial stability in evaluating bank mergers. The Fed has not issued any rules or guidance indicating the types of bank mergers that would implicate financial stability concerns, they said.

“We hope that, following the failures of [Silicon Valley Bank], Signature Bank and First Republic Bank, and the acquisition of Credit Suisse by UBS, we will see real changes to the bank merger process to protect financial stability and ensure that we have a fair and competitive banking system that serves all communities,” they said. The letter was cosigned by Sens. Jack Reed (D-R.I.), Elizabeth Warren (D-Mass.) and John Fetterman (D-Pa.).