Jay Powell Signals a Retreat on Banking Rules
Summary
Markets were still digesting the Fed chair’s go-slow comments on interest rate cuts when he signaled that proposed new rules to force lenders to beef up their books would be scaled back, or reworked. But the proposals have come under fire from bank chiefs, industry lobbyists, Republican lawmakers and even some liberal members of Congress, who fear that a mandate to set aside billions to fight the next potential crisis could feed another one. When pressed by House members on the same issue last month, Treasury Secretary Janet Yellen said she was concerned that credit availability “is not significantly diminished.” Last year, she sounded more supportive of Basel III as a defense against the next crisis. Former Treasury Secretary Steven Mnuchin came to the rescue of New York Community Bank, leading a more than $1 billion investment round that appears to have quieted many of the concerns stalking the lender for weeks. Agnifilo also represented John Venditto, the former supervisor of the Town of Oyster Bay, N.Y., in a political corruption trial, and Stefan Buck, a Swiss banker who had been accused of helping wealthy American clients commit tax fraud.