March 22, 2023

Brown Remarks at American Bankers' Association Washington DC Summit

WASHINGTON, D.C. — U.S. Sen. Sherrod Brown (D-OH), Chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs, delivered the following remarks at the American Bankers Association’s (ABA) Washington DC Summit.

Sen. Brown’s remarks, as prepared for delivery, follow:

This is the first time we’ve been able to be back in person in a while, but we’ve talked many times – the Ohio banks here today know how regularly they talk with me and with our office. My priority has always been the same – creating an economy where hard work pays off.  My job is to focus on what matters to the people who make our country work.

We want to build a strong economy with a growing middle class, that ALL workers, in all communities and regions of the country, have the opportunity to join.

We want to give people the power to grow their paychecks and their savings, and to build wealth they can pass on to their children and grandchildren.

And we want to make sure that hard work pays off for everyone, no matter who you are, where you live, or what kind of work you do.

I look forward to working with Senator Scott and the rest of my colleagues to address the most pressing issues Americans across the country are facing.


We started this Congress with a hearing on housing because it’s one of the most important issues facing working families.

Housing determines so much about your life – how long it takes to get to work, whether you have easy access to a bank or fresh food, whether you worry about your kids getting sick from lead paint or mold.

It determines your access – and your kids’ access – to opportunity.

And for too many people, safe, affordable housing, and the opportunity it provides, is just too hard to find.

We need nearly 4 million more homes to keep up with demand. In Ohio, we’re short 50,000 homes.

And because there aren’t enough homes, renters and homeowners are stuck paying more every month, or living with peeling lead paint or leaks – if they can find a home at all.

This isn’t just a problem in big cities or on the coasts. And it isn’t a Republican problem or a Democratic problem.

It’s hitting every community – rural, suburban, urban, and Tribal communities – and every state in the country.

It will take all of us working together to solve it. The Committee is working to find common ground and I am hopeful.


One area where I think many of us can come together, on a lot of issues, is the idea that everyone ought to play by the same rules – banks, crypto, fintechs, ILCs, all these new entities.

In December, I introduced the Close the Shadow Banking Loophole Act with Senators Casey and Van Hollen.

Many of you know how traditional banks, with their regulatory safeguards, are at a competitive disadvantage with industrial loan companies that try to operate like banks.

We need to close the ILC loophole.

Letting Big Tech and commercial companies operate banks without oversight will only lead to more predatory lending, more invasions of privacy, and more financial instability.

I’ve been concerned that when banks get involved with crypto, it spreads risks across the financial system.

And we know who always ends up paying the price for risk – it’s taxpayers, it’s consumers, it’s workers.

We’re all watching the ongoing effects of FTX’s collapse, and seeing what can happen when a bank relies too much on a risky, volatile sector like cryptocurrencies. 

We all know we need to establish strong safeguards for our financial system from the risks of crypto.

We must consider how to protect consumers from unregulated digital assets, and ultimately, who we want our financial system to serve – all Americans, not just those at the very top.

Crypto isn’t special.

As we consider a regulatory framework for digital assets that puts consumers first and keeps our financial system safe, we can start with commonsense principles – like clear disclosures and transparency, internal governance and risk management, and oversight and supervision.


We know why crypto and fintechs are appealing to people.

Millions of Americans are underbanked or unbanked.

People are fed up with fees on everything – overdraft fees, low balance fees, transfer fees. They not only drain bank accounts, but also push consumers out of the banking system and into the arms of shady lenders who are all too willing to overcharge them for similar services – whether it’s a check-casher in the strip mall, or a new fintech app.

That’s also why it’s disappointing that banks are attempting to take away one of consumers’ best resources to get their money back when they fall victim to financial scams and unfair fees.

The CFPB has returned more than $16 billion directly to consumers.

Maybe that’s the problem here. Banks and other financial institutions want to keep that money.

If the Supreme Court rules that the CFPB’s funding structure is unconstitutional, it’s unclear what happens to the money that CFPB has returned to consumers. Will banks ask their customers for that money back?

Then there’s the impact on the economy. We just witnessed how one economic wrench can quickly escalate and potentially destabilize the economy.

The CFPB has written many rules, including important mortgage rules that the industry relies on to set the rules of the road.

The last thing we need right now is more instability, and to sow more misgivings about traditional banks.

And too often, traditional banks don’t even seem interested in many potential customers. Every year we see bank branch closures in middle class and working class communities in Ohio and across the country.

Banks serve a unique role in the functioning of our financial system and economy. You must serve the needs of ALL members of your communities, and you need to serve all communities across the country.

I have urged the OCC to hold public meetings in response to community requests to evaluate the closure of a branch in an LMI community. I expect bank regulators to strengthen the bank merger process and ensure that banks are meeting all requirements before a branch is permitted to close.


Ultimately, so much of this comes back to trust.

Americans were reminded of over the past week how the stability of our whole banking system is built on trust. Here’s the part I’m guessing most of you were most interested in hearing – or maybe the part you were most dreading. Of course we need to talk about Silicon Valley Bank.

When Silicon Valley Bank failed, I talked to so many small businesses in Ohio that were worried about making payroll come Monday, because their money was stuck at SVB.

Ohioans trusted their banks with their hard-earned money. In return, we expect our banks to put those dollars to use at something productive – financing homeownership, funding small businesses, investing in American talent.

We need that trust in our financial system now more than ever.

But crisis after crisis, over and over, makes it pretty hard.

Does decades of watching our financial system reward executives, at the direct expense of everyone else, build trust?

Does suing the only federal agency dedicated to protecting consumers build trust?

Does Wall Street funneling much of its capital to wealthy executives in the form of stock buybacks build trust?

Does lobbying to weaken rules meant to protect the public build trust?

When I first heard about SVB’s collapse, my mind immediately went to another crisis in my state, in East Palestine, Ohio.

They have one thing in common: corporate lobbyists pushed for weaker rules, less oversight.

Companies cut costs, failed to invest in safety – or perhaps in the case of SVB, were too incompetent to realize they too should care about safety.

And working people paid the price.

The banks and the railroads are two of the oldest, most powerful lobbies in this town.

For decades, the railroads blocked any effort to increase safety standards. They resisted any attempt to stop their cost-cutting.

Norfolk Southern dutifully followed the Wall Street business model: boost profits – and its stock price – by eliminating 38 percent of its workers over 10 years, and then spend $3.4 billion on stock buybacks last year, instead of investing in its workers and safety.  

Today, the new Republican senator in my state, J.D. Vance, and I have a bipartisan bill to finally pass some real safety standards.

And still, the railroads are resisting it.

At the hearing with the Norfolk Southern CEO two weeks ago, he tried to skate around the issue. He said his company is “committed to the legislative intent to make rail safer.”

That’s some impressive corporate PR obfuscation.

They’re claiming they like the ideas, so why put them into law? Just trust the railroads to do it on their own. Don’t saddle us with “regulatory burden,” they say – we can just police ourselves.

That didn’t work for Norfolk Southern, and it didn’t work for Silicon Valley Bank.

SVB spent hundreds of thousands of dollars pushing for exemptions for banks like theirs.

Their CEO said that they shouldn’t be subject to strong guardrails because of the “low risk profile of our activities and business model.”

“Low risk profile.”

We all know how that turned out.

I know many of you think this critique is unfair. Many of you get unfairly targeted because the biggest banks – or in this case, the most incompetent banks – screw up.

The more we learn about SVB, the worse the management of this bank looks.

Most of you DO want to do right by your customers and communities. Most of you are good managers.

This past week, I also spoke to banks and credit unions – big and small – who understand how important it is to have confidence in our banking system. Everyone I’ve talked to understands how the quick actions by regulators were crucial to restoring any semblance of trust.

It’s going to take a lot more than that, though.

High standards build trust. And no industry – whether it’s banking or railroads – has ever shown they can hold themselves to those standards entirely on their own, without strong rules.

Beginning next week, our committee will hold hearings and conduct oversight. We’ll hear from regulators, we’ll hold executives accountable, we’ll examine deposit insurance coverage issues, we’ll look at the role of social media, we’ll consider legislation to strengthen guardrails. And I’ll continue pressing regulators to do a full review of the bank failures.

I hope that the banking industry won’t be an obstacle.

We ought to share the same goal – to make sure this doesn’t happen again. It’s in nobody’s interest for more banks to fail.

If you see bad actors, you should speak up. Push them to do better.

And we all should be able to come together to look at ways to strengthen trust in our banking system, and in our larger economy. 

Americans are never going to have faith in our economy as long as we have a system where Americans feel – pretty legitimately – that whenever a corporation screws up, working people pay the price. 

I’ll keep fighting for Main Street over Wall Street. For families over corporate profits. Because when you love this country, you fight for the people who make it work.