Finance. Viableude this is not a option. Activities,diminution worked wo find a solution and find a balance between taxpayer an annual access to credit. Four years ago, a bipartisan. Roup passed this committee we have an opportunity to build on that effort and create a broader coalition of republicans and democrats to pass a bill. Nto law it remains one of my Top Priorities and i look forward to continuing with secretary mnuchin and other stakeholders throughout the process. Washer focus of this report Cyber Security. Area due toty is an the increasing criminals and growing scope and scale of icious malicious fax attacks, including data breaches. The maliciousness in the probably can private sector keeps growing at an alarming rate and seems to have impacted the majority of all americans pare the council made recommendations to specifically address security risks, including greater collaboration collaboration. It is critical that personal data is affected by both the government and industry and when breach, an attack or a the impact on victims is minimized. Taken by the council since the last report, this included resending the resignation of two nonbank committees. Many have been critical of the lack of transparency and rigor for decimating nonbanks in november 2017, treasury issued a report outlining recommendations for enhancing the nonbank designation process. Which included tailoring resignations and ensuring the designation analyses are rigorous, clear, and transparent. Past, the threat of serious regulatory consequences and concerns that received a designation. A higherslates into cost for consumers and the overall economy. Determinations, the process must be transparent, objective, and measurable come with clearly outlined material for when it is appropriate. It must also provide for when they are shed. I look forward to insight on issues. Senator brown. Welcome. I look for to her testimony. The economy has grown steadily for the past eight years in large part because of the hardearned progress of the obama administration. Has fallen and some but certainly not all families have come before the financial crisis. We havei look forward to made pe have some challenges in this country. Now standing only 2. 4 , the lowest since 2005. Household debt continues to climb. Job growth in 2017 was ok. We will hear about that tonight. 2017, it waswth in below in 2011, 2012, 2013, 2014, 2016. Lostlion americans have Health Insurance since this. Resident took Office Americans actually fell, in large part affected by an opioid at epidemic in washington. Stock markets around the world have been on a tear, which helps the top americans. These are the people who own 92 percent of stocks in the United States. It is good for workers with a 401 k and we welcome that for too few workers have that Retirement Security and only one third of workers are making contributions to a 401 k or similar plan. The president likes to take the ugly bubble in little over a year ago, it will be interesting to see if he is eager to take credit for a down market. Most workers bill that the hardearned paycheck. The economy last year was the years, the prior three the wages continue to be far too weak. Machinist building a secure evere class is as tough as. They are only making these problems worse. It gives a huge boost to the richest people in the country. It keeps in place the idiotic Tax Deduction that corporations get shut or shutting down in , andand moving to beijing in fact, American Companies will be enticed to do that more. I fully nothing to the irs, overseas manufacturing operations brought to you by this tax bill. Our kids will be left with the tap, picking of a trillion dollars in new deficits, something your party and republicans in this town used to care about. I will be the first took knowledge with the company does the right thing and boost wages. Thanks ceos these increased pay for tellers, averaging about 30 per hour. Custodians and contract workers long before. I thank them when they do that. I call them and i complement them. Ive offered an amendment for the tax bill to Award Companies that did write whethercustodians long workers. Workersy they pay some more but lets keep this in perspective. Fargo, a bank you are familiar with. After the tax bill, wells fargo put on a press release to brag for raising pay 50 an hour. We reppo welcome and thank them for that. Last week, the bank announced it was eyeing back more than 22 billion of its own stock this year. That is 288 times more to juice their stock in the cost of raising workers pay. 288 times. Bank of america a 17 billion phasing outk while free checking for certain customers now charging 12 a month. The middle class is not just getting the short end of the tax bill. We know they will pay the price if we roll back the rules for the financial industry. It comes as no surprise as the administration looks like a retreat for Goldman Sachs executives. The treasury has issued a steady drumbeat of support suggesting hundreds of changes to our Consumer Protection and Financial Stability rules and will make the risk and severity of the next crisis much bigger. Tools are only as powerful as the members using them. Test members were equal here to do the hard work of keeping wall street honest but this new team would rather join them for instead at a ski resort of fulfilling wall streets wishlist, we should be finding a longterm solution. Should invest in crumbling roads and bridges and ensure that workers are keeping the pensions they have earned. I agree with the warning that many employer plans are in tough shape and if the minister should will not act soon, millions of retirees, hence i look forward to todays hearing. You can see there still are disagreements among us on the panel. I suspect we will get into some of those today during your testimony. We again appreciate you willing to us. And report with that, we will return to your testimony. Mnuchin thank you. Than chairman crapo, Ranking Member brown, and members of the committee, thank you for inviting me today. One of my Top Priorities as treasury secretary is sustained Economic Growth for the American People, and so i am happy to report that the growth rate of the economy over the past year was higher than the average over the prior twenty years and included two straight quarters of 3 percent or higher gdp growth. The president promised robust growth, and he is delivering on that promise. I am here today to speak about the Financial StabilityOversight Councils 2017 annual report. This is an important vehicle for providing congress and the public with the councils assessments and recommendations relating to regulatory developments and potential risks to the Financial System. This report emphasizes the importance of Economic Growth to maintaining a resilient Financial System. Since the financial crisis, we have had time to assess the effectiveness of regulatory reforms and consider their unintended consequences. The report recommends that Council Member agencies address regulatory overlap and duplication, modernize outdated regulations, and tailor regulations based on the size and complexity of Financial Institutions. The report also discusses a number of risks that the council is monitoring. One that i would like to emphasize in particular is cybersecurity. The Financial Systems heavy and increasing reliance on technology increases the risk that significant cybersecurity incidents could disrupt the 2 embargoed until 10 00 am january 30, 2018 Financial Sector and potentially impact u. S. Financial stability. Substantial gains have been made, but i want to emphasize the need for sustained attention to these risks. The report makes a number of recommendations, including creation of a private Sector Council of Senior Executives in the Financial Sector to collaborate with regulators in order to mitigate cybersecurity threats. Turning to our growth policies, the tax cuts and jobs act passed last year was our top priority, and this overhaul of the tax code is already having a positive impact. Because of tax reform, over three million americans have received special bonuses or other benefits, and over 250 companies have announced investments in their workforces. Companies are announcing higher wages and increased benefits, as well as greater spending on employee training, infrastructure, and research and development. These investments will lead to longterm prosperity, and as Companies Continue to bring back cash from overseas, our economy will continue to grow. Let me now turn to some specific priorities for this new year. I want to commend both houses of congress for their work on financial regulatory reform. The bipartisan Economic Growth, regulatory relief, and Consumer Protection act is a balanced and thoughtful approach that better aligns our Financial System to support Economic Growth in our communities. Further, the legislation reflects many of treasurys recommendations from our executive order reports released last year. I encourage the senate and the house to Work Together to move legislation as quickly as possible. In december i wrote to congress providing notification of my determination that a debt issuance suspension period disp would last until january 31st. As congress has not acted to suspend or increase the debt ceiling, i have determined that the disp will be extended into february and will be notifying congress as such. I respectfully urge congress to act as soon as 3 embargoed until 10 00 am january 30, 2018 possible to protect the full faith and credit of the United States by increasing the statutory debt limit. The house and senate have been working toward modernization of the committee on Foreign Investment in the United States cfius . I support the Foreign Investment risk review modernization act firrma and applaud senators cornyn, feinstein, and burr and representatives pittenger and heck for their leadership on this issue. A modernized cfius will enable us to protect our National Security from current, emerging, and future threats, while preserving our longstanding open investment policy that is key to fostering innovation and Economic Growth. I look forward to working with congress and the relevant committees to advance firrma. One of treasurys Core Missions is to safeguard the nation by using the powerful economic tools in our arsenal. We will continue to take frequent and ongoing actions to combat threats from malicious actors. These include terrorist groups, proliferators of weapons of mass destruction, human rights abusers, cyber criminals, and rogue regimes like north korea, iran, and venezuela. We continue to review intelligence to identify targets with maximum impact, deny them access to the u. S. And international Financial Systems, disrupt their revenue streams, and ultimately pressure them to change their behavior. On Housing Finance, the Current Situation of indefinite conservatorship for fannie mae and freddie mac is neither a sustainable nor a lasting solution. The administration looks forward to working with congress to reform americas Housing Finance system in a manner that helps consumers obtain the housing best suited to their own personal and financial situations while, at the same time, protecting taxpayers. 4 embargoed until 10 00 am january 30, 2018 i am proud of what we have accomplished so far, and there is more to do. Our countrys potential is enormous, which is why americans expect their government to enact policies that allow them to succeed and prosper. Treasurys collaboration with congress is vital to that mission, and we are working every day to make it a reality. Thank you and i look forward to answering your questions. Thank you very much. I appreciated your comments about Economic Growth, regulatory form, Consumer Protection act. Commentspreciated your on the Housing Finance reform. It is currently my highest priority in the committee. In the annual report last year, was thatmendation made regulators and Market Participants take steps to encourage bright private capital in the finance system. I agree. Can you elaborate on why it is important to play a larger role and what steps you would take to further encourage that . . , thank you. I fundamentally believe in the importance of the 30 year mortgage. T is important to the economy i am openminded to Many Solutions and i have productive conversations for several members for your committee on this. I look forward to working with you on them. Have substantial private capital risk, antigovernment support or guarantee. You. Ank protectingext of taxpayers against a government guarantee, there have been a number of different ideas. Inluding observing losses front of the government guarantee. If that were part of the model, d believe they are subject to Capital Requirements to ensure that the payers are protected . Important thats there is capital and i look forward to working with you and with you and your committee and if there is any guarantee that the taxpayers are thatfor putting that up were compensated in the past. Evaluating systemic risk. The 17, thento development of an activitiesbased approach was announced to assessing risk in the insurance sector. Would an activitiesbased approach work and why is it more effective than the current approach . I think it is more effective because to the extent that we look at risky activities across an industry or within a sector, we can look at proffer regulation that deals with these and systemic risk. Cyber security is one of the most pressing issues and you mentioned it in testimony. Report identified a for u. S. Financial stability due to the increasing frequency and sophistication of such attacks. Do they see gaps or shortfalls in Cyber Security protection today and what steps i dont see any specific gaps today. This is an area where we need to always be advancing issues. Issues, oris recent recent software situations. These are some things we need to be very careful, we need to be working in publicprivate partnerships. We need to share intelligence when it is appropriate. Whatever the cost of the United StatesFinancial System, we need to major it is protected from Cyber Attacks. I appreciate your attention to all of these issues and the willingness you have to engage aggressively with us on issues as issues come forward. We will be dealing with you on each of these, as well as many more. I appreciate your attendance here today. With that, senator brown. Based on the banks threshold in the wall street reform act, its an additional factor to determine a shot of bank can cause a risk. There was a report suggesting raising that liver. Chairmans Bank Deregulation bill is an active. Its safe to say it will raise the threshold fivefold. Intoll put resources investigating shadow banks below to fifth the as your report said. I think there is a general consensus from the Regulatory Community that the threshold should be raised. The committee could always make certain exceptions if there were significant i challenge that statement. Maybe the regular readers appointed by president maybe the regulators appointed by President Trump. This bill has other consequences beyond Bank Deregulation. Totein would be unlikely deliver a large fund like longterm and capital management. When it failed, it had 129 billion in assets. More than 1 trillion in derivatives. I think you are making the system less safe and sound with those ideas. The june treasury report on banking deregulation said if we raise the 50 billion threshold, we should do it for foreign megabanks based on their domestic assets. The germans Bank Deregulation bill is enacted, foreign banks went up there going to be deregulated akin the u. S. Regional banks, correct . That is correct. Up,f we move the threshold we should also move the threshold up for foreign banks. Domestic and foreign banks should be raised. To be clear, the chairmans bill with your acquiescence will deregulate banks like santander, that has repeatedly failed stress test in deutsche bank. The only bank that would lend President Trump money after his bankruptcies and botched deals. Sent toht, your staff the committee there is classified and nonclassified reports to deal with this sanctions bill, and this report that looked like the forbes list of russias wealthiest men. I hope it is more detailed and compelling.