The head of the nation’s central bank is scheduled to appear before the Senate Banking Committee next Tuesday to give his second semiannual report to Congress on monetary policy.
Federal Reserve Board Chairman Jerome (“Jay”) Powell will give that testimony during an open hearing scheduled to begin at 10 a.m. ET on July 17. And while scheduled for the purpose of the monetary policy report, the hearing is likely to again serve as a venue for lawmakers to grill the Fed chairman on regulatory and supervisory actions against the backdrop of the since-enacted regulatory relief measure titled the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA).
Powell’s last monetary policy report to Congress was in late February and early March – first, before the House Financial Services Committee (expected to announce its own hearing for this round at any time), and then before Senate Banking. Back then, Congress was still considering final action on EGRRCPA, or S. 2155, which won final House passage in May and was enacted May 24.
The new law includes several mandates for federal financial institution regulation and supervision, and only one has been implemented through specific changes in existing rules: a change in the National Credit Union Administration (NCUA) regulation on member business lending (allowing credit unions to exclude all loans on 1-to-4-unit family dwellings, regardless of occupancy, from their member business loan cap).
For their part, the Federal Reserve Board, Federal Deposit Insurance Corp. (FDIC) and Office of the Comptroller of the Currency (OCC) last week issued a joint statement outlining how they are working to comply with the regulatory and supervisory changes mandated by the new law. These changes affect requirements for company-run stress testing; resolution plans (also known as “living wills”); the Volcker Rule (barring banks from trading for their own accounts; a proposal unrelated to EGRRCPA offers relief from current requirements as well); high-volatility commercial real estate exposures; extended exam cycles; treatment of municipal obligations as high-quality liquid assets; and appraisals for “qualifying” rural transactions (involving less than $400,000).
The Fed Board held a closed meeting Tuesday to discuss its monetary policy report. The committee said the July 17 hearing will be webcast live.