CFPB Battle Won’t Stop Bipartisan Banking Bill, Democrats Say

By Lydia Beyoud and Jeff Bater

The political battle over the Consumer Financial Protection Bureau is unlikely to derail bipartisan legislation to relax Dodd-Frank Act rules for community lenders and regional banks, several Democratic co-sponsors said Nov. 28.

“People’s emotions run very high when you mention the CFPB, and that was one of the reasons why we kept it out of the bill,” Mark Warner (D-Va.) told Bloomberg Law at the RegTech Enable conference in Washington.

Mick Mulvaney, the Trump administration’s choice to be acting director of the CFPB, has ordered employees to ignore orders from Deputy Director Leandra English. English, who was appointed by outgoing director Richard Cordray, planned to spend today at CFPB headquarters, one day after meeting with lawmakers including Senate Minority Leader Chuck Schumer (D-N.Y.) and Sen. Elizabeth Warren (D-Mass.).

The Senate Banking Committee will take up legislation (S. 2155) Dec. 5 that raises the threshold for labeling banks as systemically important to $250 billion in assets from the current level of $50 billion. The bill also offers a number of breaks for community banks, including short-form call reports and extended examination cycles.

The sponsor is Sen. Mike Crapo (R-Idaho), who chairs the committee. Co-sponsors include nine Democrats, nine Republicans, and one Independent.

“There is nothing in that bill that deals with the Consumer Financial Protection Bureau,” Heidi Heitkamp (D-N.D.) told Bloomberg Law. “That was by design. That’s a separate issue. We have nothing but great hopes for that bill receiving a favorable markup, a lot of really good discussion.”

Heitkamp said that amendments might surface from both sides pertaining to the CFPB. “We wouldn’t expect those amendments would be successful,” she added.

Joe Manchin, (D-W.Va.) similarly dismissed the potential impact of the CFPB leadership controversy. “They’re just playing games right now with this whole thing, with who’s in charge, how long they’re going to be in charge,” Manchin said. “They’ll work that out. They always do.”

Warner said he expects that the bill has enough Democratic support to achieve a 70-vote margin of approval on the Senate floor.

To contact the reporters on this story: Lydia Beyoud at lbeyoud@bloomberglaw.com and Jeff Bater at jbater@bloomberglaw.com

To contact the editor responsible for this story: Michael Ferullo at mferullo@bloomberglaw.com

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