[Congressional Record Volume 166, Number 7 (Monday, January 13, 2020)]
[House]
[Pages H189-H192]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                   PRUDENTIAL REGULATOR OVERSIGHT ACT

  Ms. WATERS. Madam Speaker, I move to suspend the rules and pass the 
bill (H.R. 4841) to require the prudential banking regulators to 
provide annual testimony to Congress on their supervision and 
regulation activities, and for other purposes, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 4841

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Prudential Regulator 
     Oversight Act''.

     SEC. 2. ANNUAL TESTIMONY.

       (a) In General.--The Dodd-Frank Wall Street Reform and 
     Consumer Protection Act (12 U.S.C. 5301 et seq.) is amended 
     by adding at the end of title VI the following:

     ``SEC. 629. ANNUAL TESTIMONY OF PRUDENTIAL REGULATORS.

       ``(a) Semi-annual Report.--
       ``(1) In general.--The prudential regulators shall each 
     issue a semi-annual report to the Committee on Banking, 
     Housing, and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives regarding 
     the efforts, activities, objectives, and plans of the 
     regulator with respect to the conduct of supervision and 
     regulation of depository institution holding companies, 
     depository institutions, and credit unions.
       ``(2) Specific contents.--Each report required under 
     paragraph (1) shall include a description of--
       ``(A) the safety and soundness of depository institution 
     holding companies, depository institutions, and credit 
     unions, including capital, liquidity, leverage, stress 
     testing, and living wills, as applicable;
       ``(B) the examination and supervision of depository 
     institution holding companies, depository institutions, and 
     credit unions, particularly G-SIBs, including--
       ``(i) a detailed description of public enforcement actions 
     taken during the reporting period;
       ``(ii) aggregate data regarding supervisory concerns 
     examiners have issued in writing to the boards of regulated 
     institutions during the reporting period;
       ``(iii) supervisory observations by the regulator on 
     particular areas and topics of concern identified through the 
     examination and supervisory process; and
       ``(iv) a description of the regulator's exercise of all 
     available tools beyond imposing public fines to ensure 
     compliance with all applicable laws and regulations, as well 
     as actions to ensure accountability for culpable executives;
       ``(C) emerging risks that may affect depository 
     institutions and potential threats to the financial stability 
     of the United States, and any actions the regulator took in 
     coordination with the Office of Financial Research, to 
     identify and mitigate those threats;
       ``(D) any recent actions taken by the regulator as a voting 
     member of the Financial Stability Oversight Council and any 
     updates related to authorities the regulator has under title 
     I or title VIII of this Act with respect to enhanced 
     prudential standards and supervision of large bank holding 
     companies and firms designated by the Financial Stability 
     Oversight Council;
       ``(E) the implementation of the regulator's diversity and 
     inclusion efforts, including its implementation of section 
     342 of this Act and the regulator's compliance with section 
     308

[[Page H190]]

     of the Financial Institutions Reform, Recovery, and 
     Enforcement Act of 1989 with respect to minority depository 
     institutions;
       ``(F) the implementation of the Community Reinvestment Act 
     of 1977, including information on examinations, guidance, and 
     regulations;
       ``(G) any mandatory provision of law that has not been 
     implemented yet by the regulator, including the date on which 
     the mandatory provision will be implemented;
       ``(H) an overview of the mergers and acquisitions process, 
     including data and descriptions of any mergers and 
     acquisitions approved during the reporting period;
       ``(I) examinations for Bank Secrecy Act and anti-money 
     laundering compliance, as well as coordination with the 
     Financial Crimes Enforcement Network and appropriate 
     communication with depository institutions and credit unions;
       ``(J) the utilization of financial technology as it relates 
     to depository institution holding companies, depository 
     institutions, and credit unions regulated by the regulator, 
     including the use of various technologies by depository 
     institutions and credit unions as well as partnerships with 
     third-party companies;
       ``(K) cybersecurity of depository institution holding 
     companies, depository institutions, and credit unions, 
     including steps taken to enhance cyber readiness and 
     strengthen the protection of consumer data; and
       ``(L) compliance with chapter 5 of title 5, United States 
     Code (commonly referred to as the `Administrative Procedure 
     Act') and chapter 8 of title 5, United States Code (commonly 
     referred to as the `Congressional Review Act'), as well as 
     all guidance documents and rulemakings issued by the 
     prudential regulator in the previous 6-month period.
       ``(3) Confidentiality requirement.--Each report required 
     under paragraph (1) shall include only information that does 
     not constitute confidential supervisory information about a 
     specific institution, but may include aggregate information 
     on an industry-wide basis or on a segment of an industry.
       ``(b) Testimony.--
       ``(1) In general.--The prudential regulators shall each 
     appear before the Committee on Banking, Housing, and Urban 
     Affairs of the Senate and the Committee on Financial Services 
     of the House of Representatives at an annual hearing to 
     testify with respect to the reports required under subsection 
     (a).
       ``(2) Vice chairman for supervision.--The Vice Chairman for 
     Supervision of the Board of Governors shall appear before the 
     Committee on Banking, Housing, and Urban Affairs of the 
     Senate and the Committee on Financial Services of the House 
     of Representatives at a semiannual hearing to testify with 
     respect to the reports required under subsection (a). Any 
     such appearance shall satisfy the requirements of section 
     10(12) of the Federal Reserve Act.
       ``(c) Definitions.--In this section:
       ``(1) Bank secrecy act.--The term `Bank Secrecy Act' 
     means--
       ``(A) section 21 of the Federal Deposit Insurance Act;
       ``(B) chapter 2 of title I of Public Law 91-508; and
       ``(C) subchapter II of chapter 53 of title 31, United 
     States Code;
       ``(2) G-SIB.--The term `G-SIB' means a global systemically 
     important bank holding company, as such term is defined under 
     section 217.402 of title 12, Code of Federal Regulations.
       ``(3) Prudential regulators.--The term `prudential 
     regulators' means the Vice Chairman for Supervision of the 
     Board of Governors, the Comptroller of the Currency, the 
     Chairperson of the Corporation, and the Chairman of the 
     National Credit Union Administration Board.''.
       (b) Clerical Amendment.--The table of contents under 
     section 1(b) of the Dodd-Frank Wall Street Reform and 
     Consumer Protection Act is amended by inserting after the 
     item relating to section 628 the following:

``Sec. 629. Annual testimony of prudential regulators.''.

     SEC. 3. DETERMINATION OF BUDGETARY EFFECTS.

       The budgetary effects of this Act, for the purpose of 
     complying with the Statutory Pay-As-You-Go Act of 2010, shall 
     be determined by reference to the latest statement titled 
     ``Budgetary Effects of PAYGO Legislation'' for this Act, 
     submitted for printing in the Congressional Record by the 
     Chairman of the House Budget Committee, provided that such 
     statement has been submitted prior to the vote on passage.

  The SPEAKER pro tempore. Pursuant to the rule, the gentlewoman from 
California (Ms. Waters) and the gentleman from Arkansas (Mr. Hill) each 
will control 20 minutes.
  The Chair recognizes the gentlewoman from California.


                             General Leave

  Ms. WATERS. Madam Speaker, I ask unanimous consent that all Members 
have 5 legislative days within which to revise and extend their remarks 
on this legislation and to insert extraneous material thereon.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from California?
  There was no objection.
  Ms. WATERS. Madam Speaker, I yield myself such time as I may consume.
  Madam Speaker, I rise in strong support of H.R. 4841, the Prudential 
Regulator Oversight Act, which is sponsored by Representative Dean 
Phillips of Minnesota, one of our new members of the Financial Services 
Committee. Through Representative Phillips' good work, this is a 
bipartisan bill.
  H.R. 4841 would require the prudential regulators, specifically, the 
Board of Governors of the Federal Reserve System, the Office of the 
Comptroller of the Currency, the Federal Deposit Insurance Corporation, 
and the National Credit Union Administration to report semiannually to 
and testify annually before Congress on their supervisory and 
regulatory activities.
  The Federal Reserve Vice Chairman for Supervision would continue to 
testify semiannually before Congress, though the new annual testimony 
mandate would satisfy one of the semiannual requirements.
  While the OCC, FDIC, NCUA currently do not have a mandatory testimony 
requirement like the Federal Reserve, receiving periodic testimony from 
all four agencies would allow for a comprehensive examination of the 
state of prudential regulation, supervision, and enforcement with 
respect to megabanks and other depository institutions.
  These reports and testimony will enhance the committee's efforts to 
oversee the regulators' work on a range of issues, including their 
efforts to hold megabanks accountable and promote diversity and 
inclusion.
  I will highlight that Representative Phillips made a few improvements 
to the bill to ensure that no confidential supervisory information is 
disclosed. The changes would still ensure Congress gets important 
aggregate data and general trends on supervisory concerns, like Matters 
Requiring Attention and Matters Requiring Immediate Attention, that 
apply to the industry or segments of the industry.
  It is also worth noting that before Democrats took the House majority 
in 2019 and provided vigorous oversight of these prudential regulators, 
it had been more than 3 years since either the FDIC or the NCUA 
testified before the Financial Services Committee.
  Congress must not neglect its oversight duties, so H.R. 4841 will 
help ensure that we have robust and regular oversight of our prudential 
regulators.
  Madam Speaker, I urge Members to support this legislation, and I 
reserve the balance of my time.
  Mr. HILL of Arkansas. Madam Speaker, I yield myself such time as I 
may consume.
  Madam Speaker, first of all, happy new year to our chairwoman of the 
full committee. I am glad to see the gentlewoman on the floor today on 
this good set of bills that she has worked hard to produce, a 
bipartisan solution to so many important topics.
  I rise in support of H.R. 4841 today, and I thank the gentleman from 
Minnesota (Mr. Phillips) and the gentleman from Georgia (Mr. 
Loudermilk) for offering this legislation.
  If there is one key point that the Republicans and Democrats can 
agree on in the post-2008 crisis, it is that increased dialogue and 
transparency on safety and soundness of institutions, and monitoring 
emerging risks and potential threats to financial stability, can better 
promote understanding of the most concerning issues facing our American 
financial system, the broader economy, and how to make sure that 
America can keep its leadership in the world in competitive financial 
services. Certainly, an active Financial Stability Oversight Council is 
an example of that, and this measure, H.R. 4841, is a key tool as well.
  It will require Federal financial regulators to appear at least 
annually before the House Financial Services Committee and the Senate 
Banking Committee to provide testimony on their oversight of financial 
institutions, including regulatory, supervisory, and enforcement 
activities.
  Under this bill, the regulators will also be required to produce 
semiannual reports to Congress on these efforts.
  Although the Federal Reserve Chairman, the Federal Reserve Vice 
Chairman for Supervision, and the Director of the Consumer Financial 
Protection Bureau are required to testify before Congress semiannually, 
similar requirements do not exist for the Comptroller of the Currency, 
the Chair of

[[Page H191]]

the FDIC, or the Chair of the National Credit Union Administration.
  Last year, the principals from the prudential regulatory agencies, 
the OCC, the FDIC, and National Credit Union Administration, willingly 
and happily testified alongside the Federal Reserve Vice Chair for 
Supervision during his statutorily required appearance.
  Committee Republicans recognize that it is good practice to have open 
and regular conversations with our prudential regulators on topics 
concerning the integrity of the U.S. and global financial systems. This 
practice is important, regardless of which party is in power.
  Merger and acquisition trends, BSA/AML exams, fintech, Bank Secrecy 
Act, anti-money-laundering exams and trends, the use of financial 
technology, cyber threats and planning for cyber protection and 
compliance issues, generally, all of these are important topics.
  I thank the gentleman from Minnesota for working in a bipartisan way 
to address some modest concerns the Republicans had with the initial 
draft. We were able to make simple changes that clarify the parameters 
for the release of information by Federal banking regulators.

  This result is a bill focused on good government and increased 
transparency. I thank the gentleman from Minnesota and his colleague, 
Mr. Loudermilk from Georgia. I urge my colleagues to support H.R. 4841, 
and I reserve the balance of my time.
  Ms. WATERS. Madam Speaker, I reserve the balance of my time.
  Mr. HILL of Arkansas. Madam Speaker, I yield 2 minutes to the 
gentleman from Ohio (Mr. Gonzalez), my good friend who supports this 
legislation.
  Mr. GONZALEZ of Ohio. Madam Speaker, I rise in support of H.R. 4841, 
the Prudential Regulator Oversight Act. I was pleased to cosponsor this 
bill introduced by my good friend and colleague, Mr. Dean Phillips.
  The Federal Reserve, NCUA, FDIC, and OCC play a vital role in 
developing a regulatory framework that promotes economic growth and 
sound regulator policies in all of our communities.
  It is important that these regulator bodies hear from Members on both 
sides of the aisle on how different policy decisions will impact our 
constituents. It is also important that Members of Congress ask 
questions and provide oversight on the regulators' activities.
  H.R. 4841 will require the prudential regulators to come before the 
Financial Services Committee and Senate Banking Committee on an annual 
basis. They will also support various reports to the committees of 
jurisdiction twice a year.

                              {time}  1715

  This includes reports on issues like soundness of depository 
institutions, compliance with anti-money laundering, and the 
utilization of fintech at financial institutions. This will help 
lawmakers better understand trends in the financial industry and 
identify potential policy proposals in response to issues facing our 
country.
  Again, I want to thank Congressman Phillips for his hard work on this 
bill and thank Chairwoman Waters and Ranking Member McHenry for 
bringing it to the floor today. I encourage my colleagues to support 
this legislation.
  Mr. HILL of Arkansas. Madam Speaker, I reserve the balance of my 
time.
  Ms. WATERS. Madam Speaker, I yield 2 minutes to the gentleman from 
Minnesota (Mr. Phillips), a valuable member of the Financial Services 
Committee and the sponsor of this legislation.
  Mr. PHILLIPS. Madam Speaker, I thank the gentlewoman from California 
for yielding and for her leadership of the House Financial Services 
Committee and my friend and colleague from Ohio (Mr. Gonzalez) for his 
kind words about this bill.
  Madam Speaker, I rise today in support of my bill, H.R. 4841, the 
bipartisan Prudential Regulator Oversight Act.
  In the United States, we have thousands of institutions where 
millions of people go every day to do their daily banking, take out a 
loan for a new car, or start saving for their children's future. It 
does not matter if you live in Bloomington, Minnesota, or Brooklyn, New 
York, the process is the same.
  Virtually all of these institutions are federally insured and, thus, 
subject to at least one primary Federal regulator. Yet few of these 
regulators are actually required to provide testimony on their 
supervisory responsibilities in Congress.
  When the Dodd-Frank Act was passed in 2010 in response to the 
financial crisis, it became a requirement and an expectation that 
Congress would hear from the leaders of the Federal Reserve at regular 
intervals regarding its efforts, activities, and plans with respect to 
their supervisory conduct.
  Today, there is no such requirement for regulators at the FDIC, the 
National Credit Union Administration, or the Office of the Comptroller 
of the Currency. These agencies are responsible for monitoring the 
safety and soundness of our financial system as well as compliance with 
Federal banking laws approved by this body. They play a large role in 
protecting taxpayers by promoting bank solvency and intercepting and 
preventing bank failures. These are the very institutions charged with 
helping prevent market crashes before they begin.
  H.R. 4841 would require senior officials of the prudential banking 
regulators to report to and testify before the House and Senate on 
their regulatory responsibilities. These reports would cover issues 
like the stability of our financial system, anti-money laundering 
examinations, diversity and inclusion programs, cybersecurity, and 
efforts to protect consumer data.
  The reports and testimony required by this bill will increase 
Congress' oversight ability, allowing this institution to more 
responsibly exercise our legislative powers by knowing with clarity how 
programs are administered and whether officials are obeying and 
complying with the law.
  The SPEAKER pro tempore. The time of the gentleman has expired.
  Ms. WATERS. Madam Speaker, I yield an additional 1 minute to the 
gentleman from Minnesota (Mr. Phillips).
  Mr. PHILLIPS. Congress has an important role to play in ensuring that 
Americans know their government is doing everything it can to protect 
their savings and their retirement, and this bill will help us get 
there.
  I want to thank my colleagues who have cosponsored this bill and 
given their support, including my friend from Georgia (Mr. Loudermilk), 
who has been a great partner in helping this legislation get to the 
floor.
  There is a saying that sunlight is the very best disinfectant. Every 
American knows that banking is complicated, and no institution is too 
big for oversight. I urge my colleagues to vote for H.R. 4841, increase 
transparency, and solidify Congress' role in achieving financial 
stability throughout the country.
  Mr. HILL of Arkansas. Madam Speaker, I yield myself the balance of my 
time.
  I want to urge my colleagues to support H.R. 4841. It is an excellent 
piece of bipartisan work that certainly speaks to the heart of Article 
I power, which is oversight over the executive. I congratulate Mr. 
Phillips and Mr. Loudermilk for their work.
  Madam Speaker, I yield back the balance of my time.
  Ms. WATERS. Madam Speaker, I yield myself the balance of the time.
  In closing, it is important that Congress conduct regular oversight 
of independent regulatory agencies like the OCC, the FDIC, and NCUA to 
ensure they are fulfilling the mission Congress gave them.
  Mr. Phillips' bipartisan bill, the Prudential Regulator Oversight 
Act, will ensure Congress gets periodic updates on a range of issues, 
including prudential regulator efforts to hold megabanks accountable 
and promote diversity and inclusion.
  Madam Speaker, I urge Members to support H.R. 4841, and I yield back 
the balance of my time.
  Mr. LOUDERMILK. Madam Speaker, I rise in support of H.R. 4841, the 
Prudential Regulator Oversight Act. First, I would like to thank Mr. 
Phillips for his leadership on this bipartisan bill and for being 
willing to address Republicans' concerns with some of the language that 
was in the original text. Mr. Phillips has worked diligently to address 
committee Republicans' views before, during, and after the markup, and 
as a result, this is a strongly bipartisan bill.

[[Page H192]]

  This bill is about transparency and oversight of the federal banking 
regulators. It would require the Comptroller of the Currency, Federal 
Deposit Insurance Corporation Chair, and National Credit Union 
Administration Chair to testify before the House Financial Services 
Committee and the Senate Banking Committee annually. The bill would 
harmonize that requirement with the existing requirement for the 
Federal Reserve Vice Chair for Supervision to testify twice a year. The 
bill would also require these agencies to submit reports about their 
activities to Congress twice a year. I appreciate that Mr. Phillips 
agreed to add several clarifications in the bill to ensure that 
confidential supervisory information is not included in these reports.
  Requiring these regulators to testify every year will help ensure 
that Congress is having a regular dialogue with these agencies. This 
will foster greater transparency into the agencies' activities and 
assist Congress in doing its job of conducting robust oversight of 
federal regulators. Some may question why this bill is needed, because 
all of these regulators testified before the Financial Services 
Committee in May of last year. However, it had been three and a half 
years since anyone from the FDIC or NCUA had testified at the committee 
before that hearing.
  As the Ranking Member of the Artificial Intelligence Task Force, I 
also appreciate that the bill requires the banking regulators to report 
to Congress about financial institutions' use of fintech, 
cybersecurity, and BSA/AML compliance. These are important issues that 
Congress must continue to monitor.
  Requiring annual testimony is a matter of good government and 
Congress doing its job of overseeing the regulatory agencies that it 
has created.
  I ask all of my colleagues to support this bill.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentlewoman from California (Ms. Waters) that the House suspend the 
rules and pass the bill, H.R. 4841, as amended.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

                          ____________________