2 million arrest figure . The committee will come to order. The gentleman from missouri is recognized for 5 minutes. Thank you, madam chair. Welcome back witnesses. Ladies and gentlemen, id like to talk about a larger issue. Heavy investment in friendly countries like russia ander china. Ms. Frazier andic diamond. You drew down after putins invasion of ukraine. They said you did the right thing by slinking your assets. There is a large list. Number two, you play a significant role in a supportin. The resen mondays china threatened violent red rick. Should he followthrough on the threat to invade taiwan. Would you pullco investments out of c china . We will follow governments guidance that hasan been to work with china. If they change that we will change it like russia. We would doo likewise. We will follow the governments guidance. We hope it doesnt happen. We would salute and follow what the American Government said. I appreciate your willingness to follow law. Mr. Diamonder is this enough to stop doing business. Ifw an invasion. Well, ill decide what will happen. Goingg to commit to pulling estimates out of china. Id calll the American Government thats what they wouldd do. We always put them at risk in fact find it before with russias situation in ukraine. We do that all of the time in every country. It will be driven by the government in occasion. That would be driven by the rules and regulations. Ms. Frazier. Supposed they said it up to you. Business to business. Its likely we would have reduced presence if any at all. You rollup and you would pullout. Rewouldth reduce it. Its a hypothetical question. , its highly likely we would have a reduced presence. They put your commitment to protectt human rights around the globe. Crimes include unlawful killing by theg government. More sterilization, rape, and torture of a large number ofun those routined. Condemn them for the horrible acts. Its the important thing. Client selections. We look at it and sacrifice. The government of china is a communistno party. The communistnc party is the government. You do business in that country you do it willingly. You doin it under their laws. So, as they commit these crimes are you okay with that . Are you willing to continue to business with people . Tinue to you say in other statements thats a a bad deal. We dont do business with companies we believe are doing atrocities. Are we doing business with them. Even though they commit these crimes. The gentleman from colorado colorado of the chair is recognized for 5 minutes. Mine would be simpler from that. I guess, im coming at things differently. I have been expressed by my republican colleagues. Lookingco at the past few months and prices held steady or dropped. The university of michigan anticipates prices to drop over the next year. In conversations, what are they thinking going to happen. This quarter, Third Quarter wasis a positive. This is this year. Negative for the First Quarter of next year. I think, negative for the second quarter. Its right in the fourth quarter. I dealt withh them at the beginning of covid19. Im not sure if you get there. They expected covid19 to do to the economy if we did nothing and held steady. We didnt do ppp, unemployment. They said wed have trouble. Thank goodness we did a lot to keep the economy moving and, you know, its a year over year increase in prices. If we go forward based on august. Om its 1. 2 for the next year. If you look at the whole summer, less than that. So, who ill worried about is an overreaction from the Federal Reserve. Last time we saw them increase Interest Rates was in the 80s and early 90s. I can tell you, colorado gotm clobbered. The Housing Market stopped and did everything else. Ill turn to you because pnc had a frequent site called the kessel company. Itit had, it suffered a lot of foreclose sures in the 80s and 90s. As did predecessors of u. S. Bank and j. P. Morgan. What do you see . What does your bank see on the horizon in terms of foreclose . With ukraine and this and that we are facing supply chain disruptions caused by covid19. Are you prepared, is your bank prepared to handel foreclose sures if the bottom falls out thatsd, a potential problem here . Thanka you. I think inflation is stickier than we would like as a result of that rates would be higher than longer we would like. The impact of that on housing is clearly already felt in the creation of new homes and sale of homes. The impact on existing homeowners and their inability to make payments with inflation. Its a real issue. We work with government funded programs and pnc funded programs to make surenc people stay in their homes. Have you seen delean quentcies rise . We have true . I mean he wasnt saying it is a production, just naming a possibility. I think the four diamonds productions. Think of america . Yes. Not to take our word for. Look at the stress te the highest unemployment the highest stock market and look at the results. Thank you. I have feel back to the chair. Thank you. The gentleman from texas mr. Williams is now, recognized. Thank you madam chairman i thank all of you for being here today. Appreciate it last week in and emerging category code was improved for gun ammunition sellers. My republican colleagues and i have expressed concern that this will make it easier to track expose andmu limit the Constitutional Rights of lawabiding gunller owners. Progressives are at the cheering that this will be a huge step forward in monitoring suspicious gun purchases. After this victory they came out with a statement on how they have been dragged in this political arena. We do not believe private campaign should serve as moral arbitrator asking private companies to decide the legal products can cannot be bought and from what store. It sets a dangerous resident and further abune invasion of consumers privacy for banks and Payment Networks to know our most personal payment. Visas against this pretty but i think the Credit Card Company should disregard the code i do agree with the Statement Released by visa. The problem with these new classification codes is determining whether its suspicioushi is a sip active exercise and anyone who is against the rights of gun owners will want your institutions a flag every single transaction with the mcc to law enforcement. Before i begin i want to get a yes or no answer from each of you. First you agree with implementing this mcc for guns and second do agree with the visae Public Statement and we will start with you mr. Scharf. Please repeat. Read them. I didnt follow it. I can read it but its cutting into our time. Its cutting into political business. In terms of your question we dont set the merchant category codes. The iso association sets them and we are instructed to follow them so what we think is not relevant. Mr. Rodgers . Certainly follow the rules of the Credit Card Companies and intermediaries that also apply the law due to the privacy of our client. Do you agree with these Public Statements . We will protect the privacy of her clients according to the law. O mr. Moynihan . My colleagues have said rules of negotiationla are not our doing. We just have to implement them but we believe in the privacy of her Customer Data and thats been true for many years. Im not sure i agree with the Public Statement at all that is their statement and im not sure if i dont disagree with it. I dont reflect another people statements. I can only speak for foreign banks. He did not intend to use the code for individual cardholders. You said you do not . We do not intend to use the code. Mr. Dimon . We dont want to be in the business of telling american citizens what they can do with their money. People understand your concerns over the issue. Okay. I have nothing new to add. I think everyones covered it. We will abide by the rules applied to the customers. Ms. Fraser what are the criteria of the credit card will use in the code . We will follow the regulatory requirements as we always do. Looking at this we dont think it will be a factor. Mr. Moynihan on similar note how would america determine customers firsttime gun purchase as someone who became recently interested . Again as my colleagues have said if i purchase a gun at a inshop with the fact that they purchased it has nothing to do with it. My last question row quick when i talk to Business Owners in texas form from there doesnt seem to be any debate that we are in a recession end up equipped withmy this question. Earlier this summer he this summer you said you believe theres a strong possibility of recession and a 20 to 30 chance of something. Can you describe the economic hurricane that we could be seeing and that you think we can avoid further economic damage . High a rates that lishan inflation war and they are meeting as we speak and they will meet in six to nine months. I dont know the outcome. The gentleman from connecticut mr. Himes whose the chair of the subcommittee on national security, International Development and monetary policy. You are now wrecking nice for five minutes. Thank you madam madam chair and i thank you all for being here. I first had in the sermon the First Quarter of 2009 when the economy was contracting at an annualized rate of 10 of the did worry a number for institutions were going to survive the week. We have come a long way and mr. Mr. Dimon you said doddfrank was a big part of that but i was assured at the time the people on my side of the aisle that doddfrank would crumble like a sand castle in the hurricane i was as assured by the other side and none of these were close to being correct. Creditli where credit is due. We got through because of your stewardship and thank you not just for not creating problems for doing what so important to my business and my district that i will forever focus on risk and after questions about risk in four s minutes. Mr. Dimon 70 plus of the origination market has less visibility. Take a minute to talk about whether we should be focused on that risk and mr. Moynihan im going to ask you in a minute or so for nonobvious risk that mr. Dimon does in covering this fraser i will close with you because you are global footprint. What risk are out there in asia or europe that could be transmitted into our system here . Mr. Dimon the origination market. I wouldnt call a systemic risk. We do need to reform it for the sake of the industry to get mortgages. Mr. Moynihan what risk are we not taking about and what is it that we are seeing right now . Et are you talking about the Mortgage Business . No generally. Sometimes i worry just as much about whats happening outside of the bank. When you thinklk about the econy and where it goes and the risk versus the leverage and honestly theres more of outside the Banking System inside and thats something i cant guess on what shouldos watch it down terms of private lending funds that have high leverage multiples. K our industry because of the examination practices and frankly the way that companies around i can anticipate so id say its always going to be about the economy. Please be more specific when your target about private monies are you talking about the private market . Not only in mortgage that everyy single class and if you look at where leverage multiples are they tend to be done outside you posted if you like your institutions are adequately capitalized over y. So youre saying their private nonbanks that are undercapitalized with the lending they are doing . Yes the inches and their funds will be marktomarket. The impact on economy by people who dont work the same way the banking works with the company. We build reserves and we work out companies for hundreds of years literally. Other people that have the staff to doy that so therefore the liquidation process causes more ongoing damage. Thank you. We have jurisdiction over some stuff but not over lots of stuff so t what we need to be wary of internationally . When we look at it the pandemic in the war highlights the fragility of the Global Economy and therefore we have to increase our concern around Energy Security through security which will not necessarily t hae an impact in u. S. But there could be spillover effects. Forri example europe to supply shock in the Energy Market could well be a factor affecting the u. S. Economy as demand slows and they enter a highly likely recession. Theres into dependencies and these new fragility is we will have to keep an eye on on. Connect that for me. Youve identified energy and good. Whats the mechanism of transmission . . Whats the mechanism of transmission by Global Energy or food markets creating problems for you . It could result in a Material Energy shock. You could see Industrial Production shutting down and you can see people who are and that could cause discontent of the population other than the fact that theres lower demand therefore lower demand for American Goods and packs the u. S. Economy. Thank you. My time has expired. Thank you very much. The gentleman from arkansas mr. Hill was recognized for five minutes. Thank you madam chair and thank you for all of you taking away from your day jobs to spend the day with us and im glad to know you have a comfort rank a few minutes ago. Madamnk chair thank you and hope each of you got a cup of water and a cracker. A good discussion today that mr. Lucas this gust it quite well and climate stress testing and the vice chairman of the fed takes its a priority and some of you are complying with that in europe are you not . Ms. Dimon. Complying with the climate stress test over your operations in europe . We have had to be in compliance with the legal requirements. Wouldco he think that cost te company to do that . I would have to get back to you with a number. If you dont mind if you could respond in writing. And you all passed a stress test and in that analysis of sharp declines in unemployment and sharp failures in performing assets when you look at those performing assets you take climate into account, right . When you make a loan to build a tower on miami beach mr. Moynihan do not do that . Thee you have to take into account the risk and the borrower. Mr. Cason has a bill he introduced here for the majority h. R. 3571 that would require a climate stress testing and would add Capital Requirements to anyone who fails that stress test based on the panel of scientific experts advising the fed. Is this a good idea and who would like to answerul that question . Em id be happy to call on ms. Fraser. Do you like that idea . Like i say we dont have the data. Its not comparable. Are notoposals comparable with industry. Is that a fair statement water raises the read as it disclosures . Mr. Moynihan you concur with the operations in europe like you are a big banc of california so you comply with caliph ornette right . B we have to. And im sure you do a magnificent job or do you we need a federal preemption of federalar privacy law and withot aid Financial Services . I think the Financial Service industry has had her years of privacy regulation that others havent and we do a good job. Other industries have an ongoing examination process so frankly we have adjusted those rules because of that. But its powerful for a private citizen. Madam chair binax congress i hope and work work with the energy and Commerce Committee on privacy. Mr. Scharf you made a comment about the mortgage banking that mortgage banking is shifted to cythe nonbank sector. Do you think regulation had anything to do with that . Congressman there is a difference between the way banks and nonbanks are regulated. No question that degree of regulation will impact what you want to do inside the company. When doddfrank said banks and bankowned companies couldnt do Mortgage Servicing was that a bad provision . Congressman im not aware that. Maybe caused all of you to divest your mortgage portfolios even though you are the largest one to four mortgage lenders in the country. After the financial crisis if all of you were asked to lower that you would be not youd be charging a capital surcharge and is that a good idea or not and does anybody else want to follow up . Peace ill have a large Mortgage Servicing asset. Capitol requirements are very specific but its up to us to determine how much of our capitol to put into it. Say thank you. If you have more please follow. Mr. Dimon the fed has a new mandate price stability and growth of the economy and we have had a proposal by the majority here to add equity to the feds mandate pitch of the fed lucas on the price stability mandate . In my opinion, yes. And canan you write a memo tt you should have a living will or is that not necessary mr. Cecere . Yo [inaudible] we have a very simple operation. 99 of her bank is thank you thank youou very much and i yield back mr. Chair. Thank you. The gentlemanan from illinois mr. Foster who is also the chair of the task force on Artificial Intelligence is now recognized for. Five minutes. Thank you madam chair. Im amazed at how consistent the industry is an almost always with some elaborate set of logic to convince us that they should be allowed to lever more. Its interesting because we have all been forced to learn that its independent of leopard so why is it that you are asking for higher levels of leverage and it was annualized at the end of the crisis. Under an extreme event where the citys do business with your own solvent and youd be bailed out by the government thats okay. The government should assume that risk so the game youll always be and is to allowed you to lever up and expose the taxpayer to that risk in our job will always be to push back against that and demand enough levels of regulatory capitol that its very unlikely the taxpayer will be called upon to do that. So just if we do you believe the higher capitol regulatory capitol levels have prevented you from having an extraordinarily profitable decade . Records show that no one is indicatedve such. Id like to spend some time talking about your customer requirements. Mr. Demchak spoke about the difficulties of dealing with financial fraud and identity fraud. Mr. Moynihan had a very unpleasant experience with a couple of state governments to have any kind of secure reliable way of authenticating you are who you say you are on line. And exposing you to high levels of fraud and doing something quick to try to fix that. This experience was ensuring countries where they have a secure way a secure and reliable way of seeing you are who you say you are. Eu does this is international and you are aware that the eu has comprehensive roadmaps for secured digital that would allow if you open a bank account you walk into a branch to get on your cell phone and you say okay get your passport or your real i. D. Compliant license on your cell cell phone and can venture cell phone but its really you and with a pretty quick interaction of a secure way of proving you are the person and theres a roadmap in other states that are chronically the technical standards were developed by iso. There countries that you do business with by korea where this is a reality today day you can prove you can use modern technology in your cell phone. What is your stance on this and what are the differences you see in the Different Countries you operate some of which have secured it alive days and summer moving toward it and where is your feeling on where the United States should be going on this . Mr. Demchak. Thank you for the question. It is a big problem and we should move towards the digital i. D. Something the Banking Industry is working toward today where once you authenticate yourself withnk one bank you can share tt i. D. In any service you may not want to use electronically. Fraud is a massive problem and their methods of historical ways to deal with this arent working. Thats a very noble approach to deal with a serious problem that there was ultimately a real government option and issuing that authentication. We have that in the real i. D. We have a physical i. D. And their standards being deployed. In individual states. Just like happens with the shout out to this better Digital Identity that we now have moving in the house and the Senate Markup and no gr by senators lummis and gillibrand are behind it. If we can get this across the finish line at least for the government. We will hopefully have something to avoid the nightmare that the banquet. A way to have citizens be authenticated. Thank you. I yield back. The gentleman from texas is now recognized. Madam chairwoman thank you very much and to the panels in front of this thank you for taking the time to be here. Mr. Demchak good to see you again. Thean opportunity that i think e have today has shown some light about how complex or businesses are. The varying attacks against you, the things that happen to our country economically, the changes that are going on, your ability to work with industry and others who were meeting capitol reassurance from you, your employees said during the pandemic did not close down their chance to go to work and maybear some of you have differt restrictions based on where you lived. Your employees went to work. He booked a the business running. There wasnt a run on the bank and the trillions of dollars that flowed through systems that you had to take and understand who your customerswa were and a. We are going through instances of monetary fiscal policy u changes to. We are watching with great cautiousness about what is going to happen next but i want to take this time to tell you that im impressed. Im glad we have got big banks. Im glad we have got stable people. Im glad we have professionals that get up and go to work and take care of the Free Enterprise system, take care of Large Companies and small companies. Im from waco texas and many of you are in waco, texas. Its now a destination of choice alwhere people are moving. We have wealth offices there because people with money are moving there. I want to thank you because we need to hear from you as we are hearingop today in their specifc questions. We really look to you to be leaders ofof our country. We look to you to stand for america and i know people have done business in china for decades. You see things, you see a better viewpoint than we do. I want you to feel there are people who respect you. There are people who know you are in a tough place. There are people that know you are having trouble getting people to not just come to work. To hold the business. They appreciate you and i appreciate the hard work that youtt do. I know that what you do is looked at inin different ways. Mr. Demchak youve been the object mr. Dimon youve been confronted with challenges but please know that we need you. We should not be onerous and what we do. We should give you the latitude. You showing up today to me is an example of what kind of professional view our what kind of men and women in the organizations that you represent that represent you, that will be there tomorrow and do care about the challenges. We need to hear from you again. I hope youll come back next year instead of putting us on the witness side we will put you on the side where you really tell us heres the way we see the world in heres where we need to be leadingedge quarter on the dollar. Here are the things that we need to hear from you. I appreciate each of you and i want to thank the chairlady and the gentleman from arkansas but i want you to go back today and a lot you to know that we need you and that you are the basis of how our nation can operate and we have so many other people in the Financial Services industry that are there because we need them to. So no questions but a big thank you. I hope you go back and tell your employees that you appreciate them just like i do my employees at a time when America Needs your and i yield back right time. Thank you very much and i thank the gentleman for his participation but the gentleman from iowa ms. Axne who is the vice chair the subcommittee on housing and development and insurance is now recognized for fivege minutes. Thank you madam chair. Ig guarantee ill be asking some questions here so get ready. Really appreciate all of you being here and its nice to see you. Mr. Sabado be concentrating onon you today. Its good to hear we will have a good conversation. I want too focus on the 13,000 wells fargo employees in our district. We spoke your last years he mentioned and you said you were going to make them a priority and you talked about the organizational structural piece that you are going to put in place and the ways he would engage and im very excited to hear about those. This news is very disconcerting at this time. There have been nine rounds of layoffs and notices to more than three and 50 i won since april. From what i understand thats in the mortgage industry. Is that correct . That is correct. Thank you. Anlast month wells fargo was planning a major retreat from its Mortgage Business. I dont likess the sound of thoe words because Mortgage Operations are one of the primary businesses in iowa and can you confirm whether that story is accurate and can you discuss what will happen with the 13,000he iowans if you shrik Mortgage Operations . Congresswoman first of all as we discussed iowa in des moines specifically is very. I see that to continue to be the case for a long time to come. I dont see that changing. We do operate businesses thaton are susceptible to market conditions. Volumes go up and vibes go down. The changes we have seen in the Mortgage Business for the most significant changes we have seen in a short amount of time given the rate and so we like all other Mortgage Companies have to take a look at our own infrastructure and ensure its done properly. The first thing you do is we try to figure out are there other roles inside the company that impacted employees and i know we have moved a significant number of employees from one position to another as we have done through these changes. Another thing i should point out des moines began, i shouldnt say began when we acquired the company in des moines and for quite a number fears the only thing we had in des moines for mortgages. Thats not true today. We have large part of the company that reside there. If you live there and you want to go elsewhere its quite likely will be able to stay in des moines simply that other role. While thats good to hear. You still havent answered my question. Can you confirm whether thats accurate that you will be taking a major retreat from Mortgage Business . Congresswoman yes or no . Is it accurate . Was limbered correct when they said they were planning a major retreat out of the Mortgage Business . Its a really easy question yes or no. The Mortgage Market is substantially lower a today than it was. Im not getting an answer. What i did think i heard from you is with the 13,000 iowans if im hearing you correctly you will do everything in your possible power to find another job for them within the other parts of wells fargo that are located in iowa. Is that correct . Congresswoman that something we do across the whole country not just in iowa. We willis have to follow up n this because im not getting a straight answer on whats going to happen of two tons of people in your district they wont answer the question about whats happening what i dont want to see is looking at the Des Moines Register about thousands of people lining up to see if they can get unemployment to get if you want to make sure we do is address any conversation around moving jobs out of the country. We will be in touch with you about that. Next i want to move on and this is good to hear. I thought the story covering wells would cover travel to get an abortion. Now our Iowa Governor push through the van and was shot down but she will now because of roe v. Wade. Can you discuss if youll be covering those and is it wolf how it will work . We have changed our plans making abortions consistent with other options for someone to crossstate lines to have as legal procedure. R it is not clear exactly how that works. Well sure that we view. In one last question can you clarify for your commitment to remaining neutral not inferring with employees on unionizing will be upheld . Center the gentleladys time has expired. Would he be able to answer that madam chair . We have to continue with the rules that we abused. I wish for him to get back to you with t an answer. The gentleman from georgia is now recognize from georgia. Thank you madam chair and thank you all for being here t i know youve been anticipating and looking forward to this day are quite a while so we do thank you for taking time to be here. One of theth issues that is paramount to me and i think its a lot of people is cybersecurity especially as we move into the digital age. Becomes more and more imperativn that we protect data especially data of citizens and customers. I come from an intelligence background in the military where we have high security clearance. We had one principle that we lived by which is if you dont need data, dont keep it because you only have to protect what you have. If you dont absolutely need information than you are to dispose of it. Part of my concern is the amount of data that you are required not only to keep but to pass on to the federal government which is what we have learned becomes the link in the cybersecurity protection chain and thats a discussion for another day whether its provisions with cpr and scores and the massive amount of data thats passed alongsc that you are required to give the federal government which the majority of this nevr looked at becomes the cybersecurity issue. At the last several airings we have had hearings we have had with you in large ceo banks have been one of the few members if not the only to bring up cybersecurity and the reason i bring this up is not just in my interest. Im hearing b from you that is e of your issues of concern. Mr. Cecere can you give us an update on cybersecurity threats in the Banking Industry that you are facing and maybe some things you are doing to address some . Thank you represented that i agree its one of the significant risk and we are all working well together. If we see a note attacking would have as we can indicate with each other and shut it down as quickly as possible. We have all made significant investments in cybersecurity from personal standpoint. We have doubled the staff unless the years within our cyber group as well as the investment to the reason for that is because its such a significant risk and i think it requires coordination by the banks of regulators in government. Okay, thank you. Mr. Rodgers this is an area of concern and i may interject that is the name of the home park of the world series the Atlanta Braves but that aside i know cybersecurity is a serious concernnt for jurist as well and can you discuss the threats and what troost is doing . I can at now playoff bound Atlanta Braves so to make that distinction. One of the reasons we emerged was to create additional capacity that are relevant for our clients and their communities but also for the protection of important data that we preserve for our clients. We have multiple thresholds that we analyze every day related to cyber. We asked third parties to come and and look at data at any particular time. We participate in all the industry including horizontal reviews by regulators and constantly looking at where we are relative to cyber. We have the capability to bring in talent and capacity on what we can do before the merger. Cyber is clearly a focus for us and one of the reasons we have merged the data as a stronger shield for clients. Thank you and while ive got of the things republicans have been working on and currently accepting feedback on a draft bill that would establish a National Consumer drivers Privacy Center and identified positively what belonged to the consumer and what data belongs to the Financial Institution etc. Mr. Rogers can you discuss way National Data privacy standards would provide clarity about who owns the data as well as privacy issues . Representative im not familiar with all the interest of that particular bill but the important part of data being owned by the client thats how we purge data. Its our duty to protect the clients data. Thank you madam chair i yield back. Thank you. The gentlewoman from ohio mrs. Baby who is the chair of the subcommittee on diversity and inclusion is now recognized for five minutes. Let me say thank you madam chair not only for this Committee Hearing but for entrusting me to be on the inclusion subcommittee and let me say thank you to all the witnesses and the basis that i know. Forme the record my comments and questions are not the message nor are they a part of any political election coming up and i can clearly sayon that for anyone who has followed me met with me or knows me using your words i find myself the guardian of doddfrank especially section section 342 as u well as the inclusion mpis with banks and equity, Racial Disparity the inwealth gap narrowing looking t cr a an external contracts with Asset Managers lawyers etc. With that said it was reported in april 2022 by the gao that there are 7 million u. S. Households that dont have big accounts andri they gave three primary and does anybody know what those three are quick let me share with you. Either they dont have enough money or they believe that these are twoo expenses or complicated what they dont know how to access it. Number three is trust. The lack of trust and oftentimes people dont see people who look like them or their community so thats a ports what i believe. Do let me tell you some good news. Sitting hereyou has met with me. On june 16 i had the opportunity to spend more than an hour with everyone if you and in additionh to that many view as recently as yesterday. Staff walked me through your chamber so im going to applaud you for that and let me tell you why. Th this chairwoman pushing the envelope and maybe having subpoena power. Making sure the issue is consistent. Ybif we are going to talk about justice and if we are going to talk about democracy and fairness that we cant take the other things whether its intelligence or cybersecurity if you dont reflect the people that put up all those dollars intoth your banks. Buying homes and everything that you are doing comes back to what ai believe and. You have moved the needle and thats what i asked you to do. Many still have a lot of work to do. Im going to give you credit because i really dont leave if it werent for this committee you would have been here. I dont think you would have done it intentionally not just the window dressing or hiring 40 or 50 peoplee and none of those people reporter you. None of those people have the opportunity to go into the boardroom. Now we are moving the needle. Now dont get real excited. We have a lot more work to do but i do believe rewarding people who are moving the needle because thats what i askedd thm to do. It gets much tougher as we go along because once you move ther needle, im a clinical psychologist by traitor. Once you move the needle you see that same type of diversity. I want to ask you about the future and thats really good but i want toab talk about the present. How many people would represent diversity that reporter you . We didnt have that before you were staffers. How many people at taking the dni or someone into their board of Trustees Rooms and did a report on dni . We did not have that before this committee so if you could move the needleom now part two which starts tomorrow as i will give you a big or needle to move but i want to say thank you for being here and im going to give you a tidbit. We are just asking you to do these things, you are making america better and you can do much more. We have done the same thing with assett management yesterday the largest Insurance Investment Company in the firm did not do sore well. So we are going to use you as a benchmark. Now we set the needle higher so i want to know how many people will make a commitment to come back to continue to do this and to continue toto move that neede could let the record show mr. Greendale raised their handm and i will hold them accountable. Thank you and i yield back. Thank you very much. The gentleman from West Virginia mr. Mooney is now recognized for fiveis minutes. Thank you madam chair. Despite the initial resistance for the pressured major creditot countries to adopt merchant category code or firearm retailers they say can be used to flag lawful gun purchases and target lawabiding citizens. Category codes or mcc are used to West Virginia is one of the most pro 2nd amendment states in the country. Nearly 60 of them have firearms in their homes. And its the safest place in the country because guns protect peoples lives. If mr. Rogers the truist Bank Services over 600,000 West Virginia and if theres talk of using this new data to flag what they call quote suspicious purchases and to me it seems like a straightforward way to target gunowners had helping prevent crime. The opposite is true. Folks avail themselves of the constitutional right to the 2nd amendment. My question is what inn your md constitute a quote suspicious transaction and what Additional Information does this codeon really provide for you to make thatat determination . Thank you representatives for that question. As we discussed earlier this is a developing area of this particular time so our positions are to follow the rules as a part of the system. Today it will protect the rights of our consumers. I cant speak to exactly what will be required in terms of reporting but that wont be something we will do on a voluntary basis. Thank you for that response. A followup question my constituents may consider purchasing firearms of cash instead of a credit card out of fear that the federal government of what the federal government might do with their data. Which merchants are following the merchantha category code and plan to go back and recode past purchases thatnt may fall under the new urchin category code . Thats not a decision we would make. Great. In closing i want to say never before have weve seen an administration weaponized financial regulators and pressure lenders and to push its agenda like we have seen with the Biden Administration. Id call this a backdoor gun registry. We must resist this political pressure. What will help us freemarket competition between small banks thats the way you get Better Service for all. More regulation you have a choice between this country some of which is social cement like social socialist countries like russia the social system does not work. Theyoc try to gobble up other countries. Have to make a basic choice between freedom and capitalism or socialism. Its failed everywhere its been tried. I applaud our role as americans and weca should push new markets and reject government control of people and leave them free to make their own choices and to targetpl them. Thank you for your participation at and i yield back. The gentleman from florida is now recognized for five minutes. Mr. Larson you are muted. Please unmute. Madam chair can you hear me . Madam chair can you hear me . Yes please continue, yes. Thank you very much madam chair. Id like to again thank our individuals on the committee and my first question to the whole panel you are asked to be strong economically and to be globally in the u. S. Financial system. When you compare u. S. Banks to the rest ofly the world the largest banks are chinese and they ares. Working around the globe to expand their strength and influence. What are some of the most significant challenges that u. S. Banks face when tryingng to compete with banks around the globe and this is to the whole panel. Mr. Larson argue addressing that to any one of our witnesses . Its to the whole panel. As we said earlier the nearterm competitiveness of the chinese Banking System is an issue but the longerterm isar e real issue. They decide the Economic Issues of the country and they have made large amounts of money and they are developing the technique to compete on a worldwide basis with the l multinational client base with the world. Outside the country. Its something to be concerned about and frankly they can operate in the u. S. And the current rule set without much problem in terms of financial resources. If anyone else would like to comment on that before go to another question . Go ahead. Thank you very much for the question. I would add many of us support the american multinational competitiveness and the scale is massive by these companies and the resulting jobs in america. For that not to be operating. American rails could be a problem in terms of security and many of the things we have been discussing at todaysr hearing. Thats where america fails. Thank you very much and i have another question for the panel. In 2021 the report from freddie mac demonstrated homes in and neighborhoods for my tour likely to receive appraisal values with a value lower than a majority neighborhoods. After takings into account the home and neighborhood raciale biases lead to the devaluation of homes in the majority black neighborhoods and 22 less do any of your banks use a tradition of automated valuation models as a means of producing the prevalence of the impact of an appraisal and i want to say this to you. In a lot of and i will use an example in the area of florida. Breaking it down to the area of tallahassee and florida. We have taken graduate school that went into neighborhoods to rebuild the data problems because the tanks did want to signgr the mortgages. They say whether you go someplace else. I just wanted to know if you are using any alternative evaluation models for appraisals and though cut it right there. Thank you congressman. We use alternative models and alternative payments where b. C. Its easier to do when we owned the mortgage of the homeequity pen with the Freddie Mac Program or government programs. With that madam chair i go joked that i have a lot more questions that i will submit. Say thank you very much. The gentleman from ohio is now recognized for five minutes. Thank you madam chairwoman and thanks to our witnesses and to my colleagues for having this hearing. A few years ago we saw a few large banks adopt a policy of refusing cash deposits. Do you think thehe cash to depot a liability and if so is it more of a market risk or relatively a relative risc . Anyone . He reminded me of something from years ago. I believe its a Regulatory Risk mr. Scharf . [inaudible] the regulator said it intimidated to make a banks is my chairwoman likes to her free will to the point where no one will speak about taking cash. Is it the rest of the Financial System collects like cash i can give a person cash whether it or electronic payment is out of risk or no . No. C thats good to hear. I was getting a little nervous and its hard because a lott of people still dealing cash and we talk about who people who dont necessarily issue of banks or have the barrier to using the Financial Sector of any size or scale. They are still transacting in a cash economy and as peoplepe become more nervous about frankly whether its government or surveillanceil capitol the ia that Everybody Needs to know everything about every transaction and everyone else. We have got a couple of colleagues who are passionate about Digital Identity and want to get all background check as soon as you talk to them. People are opting out of this and they are choosing cash. I think its aou big factor in e crib no space and by show of hands that o your bank used Digital Assets for any level of client . Not much. Not much change there. There are a lot of regulatory challenges and certainly we have worked to, some of us have for years to remedy that. Tothey are financial markets, we are only 5 of the worlds population and almost 20 of the worlds gdp and roughly 50 of the capitol markets. Unfortunately the crypto space roughly 70 of liquidity is her offshore and thats a burden to this body and congress to provide clarity in those things. I would just note the hesitancy for people in the financial or to address these issues. The concern when we look at regulators how the power of the regulatorre and the one that i think was a win of sorts know when made President Biden to try to get her confirmed that she is someone who described herself as radical and held fundamentally different views on the h Banking Industry going so far as to suggest the Federal Reserve or the than the Postal Service is a Retail Banking outlet. The folks that have only Academic Experience have trouble understanding soundness and risk in thefo private sector . I would love to see the Federal Reserve be in the banking business with branches and atms in hiring and all that sort of stuff and id like to see more people that are not academics and lawyers and economists. A great quote and practice in theory they are the same but in practice they are not. Theres a study that showed the median years of private sector experience in the Biden Administration is zero. So hopefully the next few years changes that. I have just a few moments left ms. Fraser. [inaudible] d we will someone please mute . When you look at the opportunities to improve that the way the system is done causes collateral damages for domestic countries begin have any ideas on how we can reform that if you can answer please send it. I wish wet had more time to talk about the banks in cash however we must move on. The gentlewoman from North Carolina ms. Adams is now recognized. Thank you madam chair and thank you for holding todays hearing and were witnesses than you. Im glad to see folks from back home from wells and bill rogers from truist and Brian Moynihan from bank of america. They do want to get right to it and id like to ask you to keep your remarks at 30 seconds we can hear from everyone. This question is to each of the witnesses. As you all may know i am founder cochair of the bipartisan hbcu caucus and the cdc we are grateful that several of you have taken up the Partnership Challenge and some of you wells fargo have endorsed the hbcu excellent at the this is hbcu week and the white house is pushing that as well. My question is i want to know directly please be as detailed as you can what is your longterm plan to engage with this board andir to recruit from hbcus and how were you evaluating the effectiveness of your external recruiting efforts in the Pipeline Program so mr. Scharf lets start with you. Cumbersome t and thank you fr your leadership and your extraordinarily hard work and we are proud to be a part of your leadership efforts. Hbcus for us are incredibly important relationship and from the things that we do to support the hbcus to the things that we get out of the hbcus includingg the broadbased talet in locations across the country and we have just had outstanding experience with some of the folks across the company who are products of the hbcuve system. So ultimately what well look at is the success factor that we have been keeping the folks that we bring on from the hbcus and ultimately the level of seniority and the scope of the roles that they carry inside of her company. Let me move on to mr. Rogers and keep up to 30 seconds if you can. Again thank you for your great leadership in this area as well. We are investing in week have invested in the hbcus but also important work we do and hiring hbcu graduates and then working on using the resources we have in our company and we have participated in or Leadership Institute to help educate and provide leadership training in the community and things like the summit so using her own resources in partnership with hbcus is important. Mr. Truist a . Sorry, i didnt hear you. Ive been working with hbcus for years. We help finance them and we hp grow them and we hire a lot of the kids and i would tell anyone which town is unbelievable. Extraordinary talent and my advice if you are looking for young black kids want to be successful go toto an hbcu and e if you can find them. Where you can find them. And ms. Fraser . Thank you for theou question. We are very proud to be working with hbcus. Our cfo at. Is the vice chair and puts tremendous passion and making sure we bring in and recruit and grow and develop the talent that we bring in from the hbcus and from what youve heard today wonderful talent. And we are proud that it fits the company as much much as the individual. Thank you maam. Mr. Moynahan we have a few more seconds. We have continued hiring along with contributions of hbcus. And to help them to build them out and everything we havet doe is. An Entrepreneurial Center between the two hbcus. We weree able to create an Entrepreneurial Center. I apologize amount of time that we will be watching madam chair and i yield back. Say thank you for all the work you do with hbcus. Cewe appreciate that. The gentleman from ohio mr. Gonzalez is now recognized for five minutes. Thank you madam chair. Mr. Dimon i want to ask you some questions. Mr. Dimon youve been outspoken about the Global Economy and your concerns and to define the soft lasting a soft landing with limited risk and a hard landing of the prolonged recession. From a policy standpoint what are you most concerned about or would you believe needs to happen to avoid the hard landing scenario . I think the sooner we get our hands around inflation so we avoid stagflation the worst outcome inflation with no growth in unemployment etc. And seconds to make sure we have secured a jeep policy so oil prices dont skyrocket and energy isis cario. How confident are you in that . Im keeping my fingers crossed. Me too. In the event of a hard landing would you believe the economy is multiple wearable for my financials debility standpoint . The consumer in the recession is being shaped compared to 08 and 09. If you hard landing you see it it i dont think that the issue. The financial industry can handle a hard landing. I agree with you. I agree with you on the china piecee for sure. I would encourage your banks to be a lot more thoughtful about the role that you all play in facilitating the chinese economy. They rely on u. S. Capital markets. S. We know they are no friend of ours and we talk about global stability its a rush in china proposing the greatest threats by far and i dont believe its even close. Mr. Moynahan i want to switch to ou you. Back to the consumer your retail customers how do you feel they are today from a health standpoint and if we have a hard landing would be the most concerned about . If you look at where the consumer stands today they have more money in their accounts they have foreign capacity and the implant. Is low in wages are rising. At the end of the day the question is can the fed tightened strongly enough to choke off inflation without creating high levels of unemployment . Thats the discussion in the discussion of a hard landing or soft landing. He needs to be restored because right now its not in proper balance in the last couple of years. The consumer is spending 10 more than they did last september. And they are employed. They are earning employed. They are earning so now took a but the question is what happens and that comes down to if they are are working theyll be fine. The end of the day no matter what kind of loan they have car home oron credit card if they ae working they are fine and the issues to actually get labor markets to be less tight. The fed knows the unemployment will rise but we dont want to go too far. And thats the disaster scenario and the deafness of a hard landing. It would drive unemployment up but the consumer at enormouss risk. Mr. Dimon back to you for one final question. The federal mandate do you have an opinion on what the vidal mandate is appropriate or would you consider moving us to i would say its appropriate that we shouldte monitor it. Thank you olga that i yield back. Thank you very much. At this time we will take a brief recess. Madam chair . Mr. Green from texas. I have a Credit Program question that id like to submit to all the members of the panel. Without objection. Thank you. Well take a brief recess to allow members to vote on the house floor and we will resume immediately following the votes. Let me just say to all the witnesses i appreciate the work that we are doing today. You may want to take some time to grab some lunch. The committee will stand in recess. Thank you. [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations] [inaudible conversations]