JOHNSON STATEMENT ON SYSTEMIC RISK OVERSIGHT HEARING
July 11, 2013
WASHINGTON – Today, Senate Banking Committee Chairman Tim Johnson (D-SD) held a hearing titled “Mitigating Systemic Risk Through Wall Street Reforms.” The Committee heard from representatives of the nation’s financial regulators and the Department of Treasury about the progress they are making on reform provisions that improve financial stability, mitigate systemic risk and address concerns that any of the nation’s largest financial institutions remain “too big to fail.
Below is Chairman Johnson’s statement as prepared for delivery:
“Good morning. I call this hearing to order.
“Today the Committee continues its oversight of the implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The officials before us today have been asked to update the Committee on their agencies’ efforts to improve financial stability and mitigate systemic risk. This includes strengthening risk-based capital, liquidity, and leverage rules for our nation’s largest banks; enhancing risk management; facilitating the orderly resolution of any failing financial firm; and finalizing the ‘Volcker Rule’ and other pending rules.
“These are important efforts to help realize the goals of Wall Street Reform and recently, significant progress has been made. In the past two weeks, the Fed, FDIC and OCC finalized the Basel III capital rules, and issued a proposal to reduce leverage at the largest firms. The FSOC also tagged certain financial companies for heightened supervision.
“I also want to commend the agencies for working to strike the right balance in the rule writing process, and for taking steps to address concerns Ranking Member Crapo and I raised in our February letter regarding the treatment of community banks and insurance companies. New rules should focus on reducing risk, not applying a one-size-fits-all approach to a diverse marketplace.
“While progress has been made, it has been nearly five years since reckless financial firms put our economy in jeopardy, and three years since the passage of the Wall Street Reform Act. It is time to finish implementing these reforms as quickly as possible, to put an end to ‘too-big-to-fail,’ and to protect American taxpayers from ever again bailing out a failing financial company. I have asked our witnesses to outline when their agencies will finalize the remaining rules required by the Act.
“Congress must also do its jobs by confirming well-qualified nominees and providing funding to allow regulators to write and enforce the rules. Only then will we have a regulatory system that is ready to identify and respond to the greatest risks to our nation’s economic well-being. I now turn to Ranking Member Crapo for his opening statement.”