By Nupur Anand and Saeed Azhar NEW YORK (Reuters) – U.S. Senators Elizabeth Warren and Bernie Sanders blasted the nation’s top six lenders for easing regulations to enrich shareholders instead of boosting lending to businesses and households. Banks are making wealthy shareholders richer and increasing executive compensation at the expense of financial stability and economic […]
Politics
US senators Warren, Sanders urge big banks to boost loans instead of dividends
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By Nupur Anand and Saeed Azhar
NEW YORK (Reuters) – U.S. Senators Elizabeth Warren and Bernie Sanders blasted the nation’s top six lenders for easing regulations to enrich shareholders instead of boosting lending to businesses and households.
Banks are making wealthy shareholders richer and increasing executive compensation at the expense of financial stability and economic growth, according to the senators’ joint letters sent to the CEOs of the biggest U.S. banks on Monday, seen by Reuters.
JPMorgan Chase, Citigroup, Wells Fargo and Morgan Stanley declined to comment, while Bank of America and Goldman Sachs did not immediately respond to requests seeking comment.
U.S. banks announced plans in July to raise their third-quarter dividends after clearing the Federal Reserve’s annual health check that showed lenders had enough capital to withstand scenarios such as a severe economic downturn.
JPMorgan, the biggest U.S. lender, approved a new $50 billion share repurchase program and raised its quarterly dividend to $1.50 per share, after passing the Fed’s annual stress test.
“These actions directly contradict the rhetoric your lobbyists and trade associations are deploying in Washington to sell policymakers on Wall Street deregulation,” the senators said in a letter to JPMorgan CEO Jamie Dimon. “The behaviour of big banks in 2025 suggests, much like a long body of historical empirical evidence, that this rhetoric is dangerously misleading.”
The Fed also announced it had finalised new capital requirements for the nation’s largest banks following the June stress tests.
After banks were bailed out during the 2008 global financial crisis, policymakers increased capital requirements and established stress tests to ensure big banks were resilient and could serve as a source of economic strength.
Under the second Trump administration, Wall Street is again lobbying to gut these rules, Warren, a prominent critic of banks, and Sanders wrote in the letters. If banks succeed in watering down regulations, it could jeopardize the economy, she wrote.
The senators asked bank chiefs to respond to a series of questions by September 22.
(Reporting by Nupur Anand and Saeed Azhar, editing by Lananh Nguyen, Rod Nickel and Nick Zieminski)