Neil Haggerty

The inability of Democrats and Republicans to agree on a chairperson and lack of sufficient personnel have made it harder for the commission to do its job — hold Treasury and the Fed accountable for implementing the coronavirus relief law, observers say.

At a congressional hearing, Fed Chairman Jerome Powell discussed steps to get the flow of coins to financial institutions back to pre-pandemic levels, as well as ways to ease other industry burdens.

The Fed chairman updated senators about the agency's new credit facility for midsize firms struggling in the pandemic. He also left open the possibility of additional stress tests to gauge the industry’s coronavirus response.

In letters to administration officials and large banks, the lawmakers sought details about loan recipients following reports that financial institutions had favored their wealthiest clients.

Evidence suggests some minority-owned businesses can’t access loans, and the Trump administration is under pressure to report borrower demographics. The issue is gaining attention against the backdrop of protests over the George Floyd killing.

The lawmakers cited concerns from small businesses that the current application to have coronavirus relief loans forgiven is “especially burdensome, time-consuming, and costly.”

Members of the Small Business Committee signaled backing for broadening Paycheck Protection Program access for the smallest companies, encouraging participation by nonbank lenders and other improvements.

Acting Comptroller of the Currency Brian Brooks had suggested states and municipalities should end "indefinite shutdowns" meant to combat the spread of the coronavirus. The Democratic lawmaker said he was going against the public health recommendations.

Members of both parties raised concerns that the requirements for participating in the Municipal Liquidity Facility and Main Street Lending Program are too restrictive to benefit smaller localities and certain midsize firms.

Several Senate Banking Committee members from both parties are facing tough reelection challenges in a year when control of the entire chamber — and the banking policy agenda — may be up for grabs.

The congressional showdown over the pace of rulemaking during the pandemic is a hardening of older positions on banking policy ahead of the 2020 elections, observers said.

The measure, which garnered near-unanimous support, would triple the period during which businesses can spend their coronavirus relief funds and make it easier for loans to be forgiven.

The funds include $3.2 billion in loans that community development financial institutions had already approved during the PPP's second phase.

The funds include $3.2 billion in loans that community development financial institutions had already approved during the PPP's second phase.

The congressional showdown over the pace of rulemaking during the pandemic is a hardening of older positions on banking policy ahead of the 2020 elections, observers said.

The new legislation directs the Treasury Department to protect electronic payments that Americans receive through the pandemic rescue package.

The new legislation directs the Treasury Department to protect electronic payments that Americans receive through the pandemic rescue package.

If Democrats retake both the White House and Senate in the 2020 election, analysts see threats to the industry from the appointment of new regulators and possible reversal of Trump-era deregulation. But legislation imposing new rules on financial institutions would face long odds.

Members of the Banking Committee pressed the Treasury secretary and Fed chief to ensure CARES Act funds are deployed as Congress intended. They also debated the need for more stimulus to ease the economic effects of the coronavirus.

Democrats’ latest proposal to back debt collectors, enable loans for nonprofits and provide other relief could help steer negotiations with the Senate on more stimulus.