Bank of America says it won’t oppose Obama’s regulatory plan
CHARLOTTE, N.C. - Bank of America Corp., the nation’s largest bank, vowed yesterday that it won’t oppose President Obama’s plan to create a Consumer Financial Protection Agency.
Chief executive Brian Moynihan informed White House and Treasury Department officials of the company’s stance last month, bank spokesman James Mahoney said. While not endorsing the agency, the bank agrees with the “policy direction,’’ he said.
“We’ve made it clear to various organizations of which we are part that we aren’t lobbying against the agency,’’ Mahoney said. Nor is the bank promoting the concept, he said.
The stance may put Moynihan at odds with rival bankers, whose lobbyists have spent millions of dollars to head off the new agency. Moynihan has sought to improve relations with regulators since taking over on Jan. 1 from Kenneth D. Lewis as CEO. Lewis had clashed with federal officials about the bank’s $45 billion bailout and its purchase of Merrill Lynch & Co.
Treasury officials who met with Moynihan were pleasantly surprised by the bank’s position, a spokesman said. The Treasury is watching to see if groups that represent the company in Washington also refrain from opposing the new agency.
Moynihan wants regulators to focus on making products and activities transparent, simple, and fair without singling out one type of financial institution, Mahoney said. The bank opposes proposals that would allow state regulators to overrule federal guidelines, which would be inefficient for national banks, he said.
A House of Representatives bill to overhaul bank regulation, approved in December without support from Republicans, would create an agency empowered to ban financial products deemed too risky or abusive. Senate passage is not assured; the Banking Committee’s chairman, Senator Christopher Dodd, a Connecticut Democrat, and Senator Richard Shelby of Alabama, the committee’s ranking Republican, are discussing alternatives, The Washington Post reported, citing unnamed Senate sources.
Obama has called the agency a nonnegotiable part of his regulatory overhaul effort.
The US Chamber of Commerce and the American Bankers Association have organized TV ad campaigns and encouraged members to write more than 140,000 letters to congressmen against the proposed agency, contending it is unneeded and would be too costly.
“Our industry group is beyond adamantly opposed to the CFPA; we’d use whatever word is stronger than adamant,’’ said Thad Woodard, president of the North Carolina Bankers Association, whose members include Bank of America.
JPMorgan Chase & Co. chief executive Jamie Dimon in December said, “We are not in favor of a new agency.’’ It would be “just a whole new bureaucracy,’’ he said. JPMorgan is the second-biggest US bank.
