Bringing housing and affairs will come to order. Thank you from our eight witnesses today. Senator, thank you for your work on this. The eight bank ceos appearing before us today lead the biggest global systemically important banks of the United States of america, your banks hold nearly 15 trillion in assets, manage trillions of dollars of investments and retirement accounts, fund the Biggest Companies in our country. You hold nearly half the nations deposits, more than 80 trillion in client assets, your banks touch almost every aspect of our Financial System and working americans money, even if they are not your customers. All of that makes you eight of the most powerful people in the country, the banks iran are so large, so complex, so interconnected, that their distress or failure could pose a threat to the entire global Financial System. You may be private companies, but the risks you take and the mistakes you make dont just affect you, they dont even just affect your customers, not even just your shareholders, not even just your workers, mistakes you make affect the whole economy, and as we all remember from 2008 and 2009, they can certainly affect american taxpayers. That amount of enormous power should also come with enormous responsibility. A big part of that responsibility is to make sure that investors, not taxpayers, are on the hook, when risks at your bank dont pay off. That is why we need a strong capitol requirement that the biggest banks. Because of this committee we finally have financial watchdogs in place who are now serious about the need for these protections. Common sense rules to ensure that banks can withstand losses from the riskiest financial shenanigans that create no value to the real economy. These roles protect against risky trading and derivative activities on wall street, the same activities that led to the 2008 financial crisis. That would close a loophole that allowed banks to hide behind an accounting fiction. The lower capitol requirements contributed to its failure and anyone who had any doubt about whether wall street could be trusted to use its power responsibly need only look at the current lobbying fight on this. If you have watched the local news in washington, if you have waited at a bus stop in washington, if you upload out of Washington National airport, you have probably seen ads urging people to stop and game. The eight of you surely know your audience, and you havent stopped there, you have even Gone National in that campaign, pouring money into ads for sunday night football. It is a campaign waged by your lobbyists to prevent the financial watchdogs from putting in place the stronger capitol requirements to protect our Banking System and our economy. Listening to these as you hear all kinds of claims about how stronger rules will raise the cost of mortgages and stop Small Businesses from making loans. Wall street banks are actually saying that cracking down on them will quote, hurt working families. Really . You will say that cracking down on wall street is going to hurt working families, you are really going to claim that . The economic devastation of 2008 is what hurt working families. The uncertainty in the turmoil from the failure of Silicon Valley bank hurt working families. When Small Businesses with their employees in ohio and utah, and minnesota and california and rhode island and montana and South Carolina across the country didnt know if they could get access to their money and make payroll, and of course, the claims in this ad campaign are simply not true. Your game too often is to try to confuse people. Most americans think of a banks capitol if you force people to think about it at all, most americans think of a bigs capitalize money stashed away in a vault somewhere, but that is not what it means, you will know that. Capitol is just a way to fund loans and investments in risky activities in a way that can absorb losses if things go south. It means shareholders and investors are on the did not taxpayers, and what those glossy aunts dont tell you is that your banks have been reducing homebuyers for years now, long before the new capitol requirements were proposed. Remember that. These are proposals at this point. They havent even been implemented. Be clear, absolutely nothing in these rules would stop your banks from making loans to working families, to veterans, to homeowners, to Small Businesses, absolutely nothing. The reason banks might make fewer of these good loans in the future is the same reason we have been seeing less and less productive banking activity for years. It doesnt make your banks as much money as the risky stuff. You know that. We all know that. You would rather fund risky trading and derivatives bets than boring breadandbutter Small Business lending. So, even with this rule you can still lend to Small Businesses and homeowners, you just might not increase your profits quarter over quarter by quite as much as you increase them last year, but i think most americans would agree that that is a fair tradeoff for society or Small Business lending or firsttime homebuyers, less chance of task Taxpayer Bank bailouts. In exchange, maybe smaller executive bonuses and a teeny tiny bit less profit for multitrillion dollar wall street banks. We know the Banking Industry doesnt give up without a well funded fight. Wall street for his money and highpriced lobbyists to fight any effort to put the most basic guard rules on your ability to do whatever you want. What your banks want is to maximize quarterly profits. We understand that. The cost to everything and everyone else be. We have seen over and over what a problem that is and behind that the Current System does in places, like ohio. Earlier this year when i first heard about sbvss collapse, i thought of my home in east faustino ohio, a train collapsed. They have one thing in common, corporate lobbyists for years pushed for weaker rules, less oversight. Companies cut cost, they dont care about safety if it gets in the way of increasing profits, working people always, always, always working people pay the price, that is why people hate wall street, that is why people hate washington, because these lobbying campaigns that you have engaged in usually work. We see it over and over. We saw during a fight with dr. Frank during the financial crisis. Any of us remember the quote from industry lobbyists after the president signed dodd frank. This time wall street was true to its word. The executives whose banks failed the spring lobbied for watereddown rules to make it easier to chase profits at all costs. They knew risks were building up their banks, but they chose to ignore those risks, because it meant a bigger payout for executives at the top. So, we should be concerned with the executives of even bigger banks are doing the same thing against capitol requirements. Working americans are tired of executives gambling with other peoples money and then writing off of the sunset without any consequences. That is why we need to pass the bipartisan recoup act. Tank you, senator scott to hold executives accountable for driving their banks into the ground. Thats why we need strong capitol rules. Before you protest, i know, of course, it wasnt your banks, the eight of you, that failed, but after those failures this year we are reminded about how fragile our Banking System could be and as a result, your banks only got even more powerful. So it is fair to take stock of how you are using that power. I appreciate the longoverdue increases in wages and benefits for many of your frontline employees. Thank you for that. At least one of your banks has made real efforts to get rid of Overdraft Fees. Thank you for that. But your banks need to do far better when it comes to meeting customers where they are and recognizing their dignity of work. Your employees and your customers. Should be cutting prices for consumers, increasing opportunities for your employees, increasing diversity within your executive ranks supporting your workers efforts, if they so choose to unionize. And you should stop pouring money into lobbying against efforts to protect taxpayers, who, in the end subsidize your entire industry. Reason for this hearing every year is to hold banks accountable to the American Public. I appreciate your all coming together for this hearing. We want to hear from you and what you do to support workers to invest in the real economy to finally put wall street to work for mainstream. Senator scott . Thank you, gentlemen and that is a very long list of ceos who have come to talk with us about how the impact of our Regulatory Environment will impact every day consumers, and i hope that you all for some of the things i say will be redundant based on what the german just said, but i hope you will all really answer the question, nothing in these proposals will stop your banks from lending to Small Businesses or firsttime homebuyers. Because of the proposals for an endgame, who in america knows what the endgame really is . Lets translate that for the average american at home watching this because they have nothing else on tv to watch. It is simply requiring more capitol on the sidelines, which then means fewer dollars to land to Small Businesses, first time homebuyers, car loans. So, the actual impact of a higher regulatory standard is fewer dollars to lend to americans who need desperately to be engaged in the process of achieving the American Dream that is typically defined by having access to capitol. Oh, if you work really hard, keep your life in order, you can have a good quality middle class life. But if you want to actually experience wealth in america, you have to experience the benefits of profit, or equity, equity comes from having capitol, having capitol typically means you either have it, because you are born with it or you have access to it, because you have an idea or a vision that will make your community or the station better. When that happens you go to a lending facility, a bank, or outside the market and you find that capitol that allows you to start your business and as you start your business and it appreciates it creates a profit and that profit allows you to experience the Upper Echelon of the American Dream. If you have a home look at the differences between African Americans and the majority population in net worth, tenfold difference, as much of that difference was found in the prophet where the equity in a home. So, when we think about the proposals, not of good regulation, but of a nightmare proposal that would put so much capitol on the sidelines we should think about american living and working paycheck to paycheck devastating impact to capitol, that makes the American Dream harder to achieve and act as the capitol for some folks who started where i started, virtually impossible. When you think about todays hearing from my perspective i want to talk about three things. Number one is basel iii endgame, number two is the virtual regulations and guidelines that will hamper consumer choice, and number three, the job our regulators are doing or frankly should be doing, and the work our regular users cultivate. I will start, as adjusted, with basel iii endgame. The fact of the matter is that this one proposal could have a devastating impact on Small Businesses, and i would like for you all to address that, either now ordering the questions. Last month i read a letter to the fdic, occ, calling on them to withdraw this misguided proposal, because American Families, the folks who will bear the burden of this burdensome regulation simply cant afford it. The letter was signed by nearly 80 of my republican colleagues that really spanned the entire ideological spectrum in the country. Nearly every Single Person who signed the letter did so, because they all agreed that costly harmful impact on our constituents, our businesses and their families is something that could be avoided if simply the banking regulators would listen to common sense and withdraw the proposal, and frankly last month, when the regulators spoke, even some of my democratic colleagues agreed with our concerns on the negative impacts brought to us by a burdensome Regulatory Environment. Let me be clear, this proposal would limit, and frankly will limit the following. Availability of credit for housing for those who need it most, severely restrict lending for Small Businesses that are still rebounding from the pandemic, and cut into the Retirement Savings for hard working americans, like teachers , police officers, firefighters when they are dealing with higher prices and runaway inflation brought by the radical left. These are very, very serious concerns, but americans should adjust hear about the concerns from those of us who are senators. We should hear from those who actually run the institutions that they have entrusted and have confidence in. Is a former Business Owner myself i believe that you all, as a daytoday operator of these businesses, not elected officials, have a better sense of what the communities are facing, and the challenges brought upon the communities, by these higher standards. Last month they said that the new basel iii endgame will only impact about 40 of our country. Said differently, two thirds of all of the loans processed will be negatively impacted by the endgame proposal. That is 60 billion in Small Business loans in 2021, 250 billion dollars negatively impacted, the definition of negative, higher Interest Rates are fewer loans. In 2022, in my home state of South Carolina that translates to 550 million of Small Businesses having higher Interest Rates and fewer loans and 3 billion in 2002 in Home Mortgage originations. If regulations continue to increase the costs of providing a loan, i fear that banks will decrease lending, not only in my home state, but across the country. The increase in lending means increased Financial Hardship, and increased Financial Hardship means a reduction in opportunity. That is my ultimate concern reducing opportunity for Everyday Americans. At the end of the day, these consequences will create a ceiling for low income americans and it wont be a ceiling made of glass, instead it will be made of concrete. We simply cant let that happen. The second item i want to discuss with yall today concerns the onslaught of rules and proposals targeting your institutions and the Banking System at large. For instance, in recent months weve seen proposals or final rules all the way from Climate Risk Management to the Community Reinvestment act. None of these proposals exist in a vacuum and it is vital that this committee hear from each of you about the overall impact on the health of our economy, and in particular i am deeply concerned by the continued partisan attempts of this administration to advance their climate goals, by any means possible, including through our Banking System, with the recent Climate Risk Management guidance, banks have been considering whether risks for decades, and you should, it is called common sense. And it remains incumbent upon each of you to base your lending decisions on risks you can reasonably assess, like whether a credit risk, not, however, perceived political, rhetorical or Reputational Risk , beyond the explicit cost of these, which ultimately are passed on to consumers. I fear that the only real accomplishments of the regulators will be to push more activity outside of the regulated Financial System, where we have less insight into the impact on consumers. And finally, number three, we must emphasize and turn our attention to the performance of our regulators and their core mission, the supervision of your banks and the stability of our financial economy. This past spring we saw the failures of several banks, which shook consumer confidence. Since then, there has been nonstop fingerpointing by our regulators, and the aftermath of the failures i was critical of the failed Bank Executives, because that is where the dollar should stop, the buck stops with the executives, but you cant say that in a vacuum, you have to ask yourself a question, what was the role of the regulators, what did they do, how do they respond to that . Your institutions have teams of examiners from the regulatory agencies in your offices every day and i can tell by your faces you are really excited to see them when they show up, but the truth is that we, the American People, deserve to understand the complexity of the web that exists, that makes the headwinds real for lending money to would be entrepreneurs , or firsttime homebuyers. Let me close with this. We are not on the same page on a lot of issues. I think there are times when banks go too far in getting involved in politics. But when it comes to your objective of creating acc