JOHNSON OPENING STATEMENT AT WALL STREET REFORM OVERSIGHT HEARING
WASHINGTON – Today, Senate Banking Committee Chairman Tim Johnson (D-SD) held an oversight hearing on the implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Committee heard from representatives of the Treasury, Federal Reserve, SEC, CFTC, FDIC, and OCC. The hearing examined the regulators’ progress in implementing the Wall Street Reform Act, and explored the new law’s effects on improving the stability of the financial system.
Below is Chairman Johnson’s statement as prepared for delivery:
“Today, this Committee continues its oversight of the implementation of the Wall Street Reform Act. Since the last implementation hearing in July, there have been significant developments regarding rule proposals, rule finalizations, and more broadly, additional concerns about the impact of the debt crisis in Europe.
“We don’t have to imagine a far-off crisis to be reminded of why we passed Wall Street reform. The current situation in Europe underscores the importance of implementing new rules that enhance supervision of large, complex financial firms, and the financial system as a whole, reduce risk in the marketplace, and support financial stability.
“Over the past 18 months, since the passage of the Wall Street Reform bill, much progress has been made—agencies and offices have been merged or created, and some very important rules, including the rules for orderly liquidation and living wills, have been finalized. The Consumer Financial Protection Bureau has opened its doors, and is doing excellent work on projects like simplifying mortgage and student loan forms through its “Know Before You Owe” initiative. But work remains to be done.
“Some of the most complex rulemakings of the Wall Street Reform Act are the ones still under consideration—the Qualified Residential Mortgage determination otherwise known as Q-R-M, the “Volcker Rule,” provisions to enhance supervision of nonbank financial and bank holding companies, and the rules under which non-bank financial firms will be designated “systemically important.” I want timely resolution of these critical, outstanding rulemakings, and I am looking forward to hearing about the next steps for these rules from our panelists today.
“I recognize that these rulemakings are difficult, but this is the time when tough decisions have to be made by our regulators.
“While our economy is starting to show signs of recovery from the financial crisis, the ongoing turmoil in Europe is a stark reminder that we must continue to monitor threats to financial stability. The Wall Street Reform law gave our regulators new tools to better address potential threats, to create well-functioning markets while also reducing systemic risks, and to improve supervision – but until the new rules are implemented, our financial system and our economy remain vulnerable to these threats.
“I want to thank the regulators before us today for their tireless work over the last 18 months continuing implementation of this important law. In addition, you are all dealing with many challenges, including funding constraints, the bankruptcy of MF Global, and other supervisory issues that the institutions you regulate face as the economy continues to recover from the financial crisis. I have no doubt that you and all your staffs will keep up the important work.”
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