Senate OKs bank deregulation; Merkley, Wyden vote no

(Update: Adding Wyden statement)

Sens. Jeff Merkley and Ron Wyden, D-Ore., expressed dismay after the Senate passed a banking deregulation bill on Wednesday.

Merkley’s statement:

“Ten years ago this week, Bear Stearns collapsed as the financial crisis accelerated. To working Americans, the pain of that crisis is still fresh: millions of lost jobs; trillions in lost savings; and a foreclosure crisis that devastated families and entire neighborhoods. Those Americans haven’t forgotten – but apparently the Senate has.

“The bill passed today lets small community banks make big, casino-style bets on the future price of stocks, securities and currency. This is the exact same type of Wall Street gambling that brought down our economy in 2008 – so why on Earth would we want to reopen the Wall Street casino in our community banks?

“This bill opens the door to predatory practices in the manufactured and modular homes industry – enabling corporations to prey on some of the most vulnerable working Americans.

“And it weakens requirements that help root out discrimination in the home mortgage market. This is completely unacceptable.

“We’ve already seen in all-too-recent history what happens when banks write their own rules. We don’t need to go back to those days.

“Put simply, this bill is a huge mistake.”

Wyden also voted against the legislation that he said would cut protections for consumers Congress put in place after the 2008 financial crisis.

He said the Senate banking bill weakens regulatory protections enacted after the 2008 financial crisis by substantially relaxing consumer protections and reducing the number of banks subject to heightened regulatory scrutiny.

“After the Equifax security breach and Wells Fargo customer abuses, it’s clear there’s more work to be done when it comes to protecting American consumers from big banks,” Wyden said. “Yet instead of working to provide more protections for hardworking families, this bill stacks the deck in favor of banks.

“Banks just got a big Republican tax cut. They don’t need an exemption from rules protecting consumers, now, too. I voted against this bill because banks don’t need any more help. Consumers do.”

Wyden successfully included in the broader legislation the bipartisan bill he wrote with Sen. Lisa Murkowski, R-Alaska, to boost local economies and businesses by providing small business owners better access to financial capital through credit unions. The Credit Union Residential Loan Parity Act would ensure that small residential housing loans do not count toward the business lending cap for credit unions.

Wyden also filed an amendment to the bill to require the Consumer Financial Protection Bureau to bring transparency to small business lending by identifying barriers that prevent women and minority entrepreneurs from starting small businesses. The amendment was not included in the bill that passed the Senate.