Senate Banking Committee Considers Federal Reserve Nominees

On February 3, the Senate Banking Committee held a hearing to consider the nominations of Sarah Bloom Raskin to serve on the Federal Reserve Board as Vice Chairman for Supervision, Dr. Lisa DeNell Cook to serve as a Governor of the Federal Reserve Board, and Dr. Philip Nathan Jefferson to serve as a Governor of the Federal Reserve Board. The hearing focused heavily on the impact of inflation and rising prices on the economy, the independence of the Federal Reserve, and climate change. Several Republican members of the Committee expressed concerns with prior statements made by Bloom Raskin regarding banks’ allocation of capital to industries with large carbon footprints (such as oil and companies). Bloom Raskin noted that it is not within the purview of the Federal Reserve to make capital allocation decisions, instead the goal of the Vice-Chairman position is to identify potential risks to the financial system. The Dodd Frank Act established the role of Vice Chairman for Supervision that was responsible for the development of policy recommendations regarding the supervision and regulation of depository institution holding companies and other financial firms supervised by the Fed. At the conclusion of the hearing, Committee Chairman Sherrod Brown (D-OH) stated that the Committee plans to hold a vote on all three nominees on Tuesday, February 15.