LIVE Update from Geithner’s Senate Banking Committee Hearing
Here’s a report from AFP Government Relations Manager Jeanine Arnett:
Following yesterday’s announcement by President Obama of a financial regulatory overhaul, the Senate Banking Committee convened a hearing this morning where they are receiving testimony from Treasury Secretary Timothy Geithner. In his prepared remarks, Geithner provided an overview of the President’s plan and highlighted several areas where the regulatory structure will change.
Of note to AFP members and other treasury professionals, Geithner said that this new approach to regulation “cannot be built based on banning specific financial products that are deemed too risky.” This position is reassuring in that it suggests that the new regulatory structure will be focused on establishing a firm system on overall and not a knee-jerk reaction to individual occurrences.
Secretary Geithner went on to say that the new model will strengthen both consumer and investor protections. Oversight and rules will focus on greater disclosure and seek to prevent abuses.
Members of the Committee were very skeptical of giving the Fed new regulatory authority based on the past occurrences of the Fed as a good regulator of banks. Secretary Geithner reiterated that under this new plan, the Fed would only have a modest increase in authority and ensured substantial and sufficient checks and balances.
Watch Secretary Geithner testify live.
Read Secretary Geithner’s full statement.
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