Bank Mergers Well-Policed, Regulators Say
WASHINGTON — The government’s top banking regulators Tuesday defended their handling of a recent wave of bank mergers as congressional critics questioned whether customers and taxpayers are being adequately protected.
Comptroller of the Currency Robert L. Clarke and officials from the Federal Reserve and the Justice Department said existing laws gave them all the power they needed to adequately police the mergers, which they said would not be allowed to proceed unless they resulted in an improved banking system.
“We want stronger banks and a stronger banking system at the end of the process,” Clarke told the House Banking Committee.
Federal Reserve Gov. John LaWare presented a forecast that his agency prepared predicting that the drive toward consolidation could cut the current 12,500 banks almost in half during the next two decades.
LaWare said the forecast expected that, even after the wave of mergers, the bulk of banks remaining would be local community banks.
“All of us want consumers of financial services to have available competitively priced, high-quality banking services, and we want to ensure that U.S. taxpayers are not exposed to excessive risk of loss through the deposit insurance fund,” LaWare told the committee.
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