The Financial Brand, May 2021, Will New Administration Rewrite the Rules on Banking Mergers?
When the previous DOJ Antitrust Division leadership asked for comments about bank merger guidelines, a group of members of Congress wrote that “As the financial industry changes, we call on the DOJ to protect our communities and strengthen its merger guidelines rather than bowing to industry pressure and rolling back protections.” The group included Jesus Garcia (D.-Ill.), a sponsor of the House version of Warren’s legislation and a vice-chair of the Congressional Progressive Caucus, and Alexandria Ocasio-Cortez (D.-N.Y.)
Regarding the influence of fintech on the supply of services, the National Community Reinvestment Coalition wrote, “…the digital financial providers may not have much of an impact in low- and moderate-income neighborhoods since customers unfamiliar with banking are less likely to engage in significant digital banking transactions.” On the small business side, the coalition noted that Federal Reserve research has found that small firms “tend to be less satisfied with fintech loan terms and conditions.”
The group also called for imposition of special requirements on very large mergers, such as those involving institutions over $10 billion. Specifically, merger applications would have to include “public benefit plans” affecting the merging institution’s entire geographical footprint. (It’s common in very large mergers for institutions to voluntarily make grants or other offers of aid to community groups in affected areas.)