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Trump administration

Treasury Secretary Scott Bessent House testimony: Live coverage

ByClaire Williams, Ebrima Santos Sanneh, John Heltman
February 4, 2026 10:00 AM
Scott Bessent
Treasury Secretary Scott Bessent on Capitol Hill in June 2025.
Bloomberg News

WASHINGTON — Treasury Secretary Scott Bessent is going to Capitol Hill Wednesday morning to testify before the House Financial Services Committee as part of the committee's oversight hearing for the Financial Stability Oversight Council. 

Bessent, who as Treasury Secretary chairs the FSOC , has been at his post for just over a year and has overseen a wide range of changes in the financial regulatory sphere. Last March, he said that bank regulators need to be "singing in unison from the same song sheet" and vowed to correct what he described as "backward-looking" regulations.

In FSOC's 2025 annual report, the council — which is made up of the heads of each of the 11 federal financial regulators, as well as a designated insurance expert — touted the creation of a number of new working groups and work streams, including groups focused on market stability, AI and household financial health. The council will also refocus itself on crisis preparedness through a work stream dedicated to preparing for cyberattacks or other "disruptions at critical service providers, including through the potential acquisition of quantum technology by threat actors."

Bessent has not appeared in the House since last May, and at that time faced pointed questions from Republican members about forthcoming plans to implement the remaining provisions of the Basel III accords, known as Basel III endgame.

The Federal Reserve, OCC and FDIC published a proposed rule in July 2023 under then-Federal Reserve Vice Chair for Supervision Michael Barr that would have raised large banks' capital requirements significantly. That proposal received unprecedented pushback from the banking industry, and Bessent vowed that any reproposal would "safely and soundly expand the regulated financial system and get [smaller banks] on equal footing [with nonbanks]."

The retooled Basel proposal is expected to be released sometime in the first quarter of 2026, according to Federal Reserve Vice Chair for Supervision Michelle Bowman. Regulators have already issued final rules revising the enhanced supplementary leverage ratio, one of the capital reforms Bowman highlighted as needing reform.

12 Posts
2m ago

Bessent alludes to varied thinking about Fed in administration

By Ebrima Santos Sanneh
About Ebrima Santos
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Scott Bessent
Treasury Secretary Scott Bessent in the House Financial Services Committee on Feb. 4, 2026.
Bloomberg News
Rep. Richie Torres, D-N.Y., pressed Treasury Secretary Scott Bessent on the independence of the Federal Reserve, alluding to Fed Gov. Lisa Cook's legal battle over Trump's attempt to fire her and the Justice Department's investigation into Fed Chair Jerome Powell. 

Torres asked whether the President has constitutional authority to remove the Fed chair or a Board member solely over policy disagreements. Bessent declined to answer the question directly.

"I'm not a lawyer and I don't have an opinion," he said, noting that, "there are varying opinions in the administration."

When asked whether he views the Fed as part of the executive or legislative branches, Bessent said, "I consider it an independent agency." When Torres pressed Bessent to clarify whether he meant to say that the Fed is neither executive nor legislative in nature, Bessent replied, "We'll see," referencing the Supreme Court's pending ruling on an emergency petition to remove Cook from her post pending the outcome of her challenge. 

Torres stressed the importance of Fed credibility, saying the administration's actions on the Fed board risk undermining its reputation for nonpartisan judgement. 

"I do believe that the Federal Reserve has to maintain credibility and be like Caesar's wife, beyond reproach," Torres said. "And undermining the independence of the Federal Reserve is a threat to that credibility."
36m ago

Bessent spars over legal basis of Venezuelan oil proceeds

By Ebrima Santos Sanneh
About Ebrima Santos
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ebrima.sanneh@arizent.com
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Scott Bessent
Treasury Secretary Scott Bessent.
Bloomberg News
Rep. Sean Casten, D-Ill., pressed Treasury Secretary Scott Bessent on the legal authority for U.S. control over Venezuelan oil proceeds following the capture of the country's former president last month.

Casten noted a January 9 executive order directs the Treasury to hold the funds "in custody" and facilitate disbursements.

Bessent said Treasury acts under an agreement with the acting Venezuelan government, and later cited International Emergency Economic Powers Act. Casten pushed back, saying IEEPA applies only during ongoing hostilities with other countries, and noted that Secretary Marco Rubio has said the U.S. is not at war. Bessent suggested IEEPA might apply "for a period of transition" but agreed to provide written legal guidance.

Casten also questioned Treasury's oversight of the funds, asking how the Treasury ensures funds don't return to "shady characters." Bessent said outside auditors would be brought in, but no agreement with them is yet in place.
54m ago

Bessent won't comment on CDFI funding release

By Claire Williams
About Claire
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Rep. Joyce Beatty
Rep. Joyce Beatty, D-Ohio.
Bloomberg News
Continuing on the theme of contentious interactions with Democratic lawmakers, Treasury Secretary Scott Bessent refused to answer a question about Community Development Financial Institution fund disbursement from Rep. Joyce Beatty of Ohio after she demanded a yes-no answer. 

"Are there plans to … release monies to the CDFIs so they can continue to finance affordable housing projects," Beatty said. "That's a yes or no." 

Bessent began responding but Beatty interrupted. 

"I'm trying to be respectful, but you're not going … to do what you want to do on my time," she said. "Yes or no — or you can say I'm not answering and I'll move on." 

"Number three," Bessent said. 

"Okay, so let the record show that he refuses to answer the question," Beatty said. 

The CDFI fund has been a target of the Trump administration, but it appears to be a rare point of disagreement between Bessent at Treasury and the Office of Management and Budget. Treasury has said that all the CDFI programs are statutorily mandated, but OMB has refused to release the funds for Treasury to disburse. 
1h 3m ago

Bessent acknowledges potential effects of 10% cap

By Ebrima Santos Sanneh
About Ebrima Santos
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Rep. Jim Himes, D-Conn.
Rep. Jim Himes, D-Conn.
Bloomberg News
Rep. Jim Himes, D-Conn., questioned Treasury Secretary Scott Bessent about President Trump's proposal to impose a temporary 10% cap on credit card interest rates, pressing him on the potential consequences for borrowers. 

Bessent said the proposal reflects the president's focus on affordability and would give consumers time to recover from inflation, but he did not outline an enforcement mechanism. 

"The President is interested in affordability for the American people, and I think his view is that banks have done very well, and that by capping the rate for one year, it would give the American people the chance to recover from the horrible Biden inflation" that took hold as the COVID pandemic was easing in 2021.

When Himes raised concerns that a cap could restrict credit availability, especially for subprime borrowers, Bessent acknowledged the risk would need to be examined, while arguing that the credit card market already disadvantages lower-income borrowers by shifting competition away from annual percentage rates and toward rewards that primarily benefit higher-end customers.

"I think that would be very important to examine as it's being as it's being put in," Bessent said. "But Congressman, what we've seen over time is credit  cards used to compete on what was known as APR — the financing rate — and now they compete on rewards. … Subprime borrowers are paying higher APR, and the upper-end borrowers are getting more rewards. So maybe there's a calculus here on how to diminish the rewards, and cut the APR."

Himes pressed Bessent to clarify his earlier reference to "bad actors" in the credit card market. When Himes asked who those actors were, Bessent declined to name any specific companies. 

"I'm not going to name them," Bessent said. 

Himes responded that acknowledging bad actors but refusing to name them limited Congress's ability to conduct oversight. Bessent pushed back, telling lawmakers, "I think you have very large investigative committees."
1h 22m ago

Bessent backs Fed independence, but only on monetary policy

By John Heltman
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Treasury Secretary Scott Bessent
Treasury Secretary Scott Bessent.
Bloomberg News
Treasury Secretary Scott Bessent said Wednesday that he supports the Federal Reserve's independence, but added that the central bank's initiatives outside of monetary policy actually undermine the Fed's credibility on monetary policy.

Rep. Emmanuel Cleaver, D-Mo., asked Bessent about the Fed's independence in the face of unprecedented incursions by the White House into the central bank's longstanding independence from politics. Bessent said he supports the Fed's independence, but added that there must also be "accountability."

"We've seen these cost overruns. The … independence of the Fed is based on its trust with the American people, and Federal Reserve lost the trust of the American people when it … allowed the greatest inflation of 49 years to ravage, ravage working people in this country," Bessent said. 

Bessent added that the Fed's non-monetary policy duties and activities don't comport with its presumed independence from politics. 

"The Federal Reserve should be independent for monetary policy, and every other program it undertakes impinges on the monetary policy independence — whether it is cost overruns on a building, whether it is including the climate, whether it is offering political opinion," Bessent said.
1h 29m ago

Bessent not concerned with Trump tariff pause stock bump 

By Ebrima Santos Sanneh
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Rep. Al Green
Rep. Al Green, D-Texas.
Bloomberg News
Rep. Al Green, D-Texas, pressed Bessent on whether President Trump's tariff announcement last year subsequent social media post should be investigated, citing market volatility following the announcement.

Green asked Bessent to recall "Liberation Day," when Trump announced a new round of tariffs. He said the announcement was followed by a sharp drop in the stock market. Green argued that President Trump's declaration on Truth Social hours before the tariffs were paused, Trump wrote that it was a great time to buy DJT, the ticker symbol for Trump Media & Technology Group, in which the president holds a majority stake. The company's valuation increased following the post. 

"When he made that announcement and said, it's a great time to buy DJT, that happens to be the symbol for his stock, DJT," Green said. "I ask you kindly, and as one professional to another, Mr. Secretary, you think that this should be investigated? The president's stock being linked to his Truth Social message, and that stock having gone up by some $415 million in a single day — in a single day — and this is a stock that was doing very poorly prior to that."

Bessent said the movement in the stock price didn't bother him and that "all Americans benefited," from the rebound in the markets. 

"Well, those are his initials," Bessent said, acknowledging it was the President's stock. "I believe that anything that is widely disseminated and available to everyone…" Bessent continued before being cut off. 

Green argued the sequence of events resembled market manipulation, characterizing Trump's behaviour as, "almost a hustle."

"I don't want to say that about the president, but making this kind of move would at least be investigated," Green said. "If you're going to allow the President to do this openly and notoriously … what you're doing is giving him a license to move markets at will, make announcements and reap benefits."
2h 0m ago

'Stop being his flunky:' Bessent hearing goes off the rails

By Claire Williams
About Claire
byclairew
Rep. Gregory Meeks
Rep. Gregory Meeks, D-N.Y.
Bloomberg News
Democratic lawmakers grew frustrated with Treasury Secretary Scott Bessent, who talked over House Financial Services Committee ranking member Maxine Waters, D-Calif., at length. 

In a subsequent question from Rep. Gregory Meeks, D-N.Y., about whether Treasury would investigate World Liberty Financial, the Trump-connected crypto firm that recently applied for a bank charter, Bessent went well over the allotted five-minute time frame. 

"I'm not going to ask much of you, Mr. Secretary. I just want to know whether you will commit today to pause and heightened the scrutiny of any bank charter or licensing application at the OCC connected to the world Liberty Financial,' Meeks said.

The incident set off a long period of raised voices between the two men. 

"Stop being his flunky," Meeks said, referring to Bessent and Trump.
2h 6m ago

Rep. Lucas asks Bessent on deposit insurance reform

By Ebrima Santos Sanneh
About Ebrima Santos
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Rep. Frank Lucas, R-Okla.
Bloomberg News
Rep. Frank Lucas, R-Okla., asked Treasury Secretary Scott Bessent to weigh in on whether he supports expanding deposit insurance coverage for payroll accounts. While Bessent stopped short of endorsing any specific coverage level, he emphasized his support for the spirit of protecting depositors at small banks.

Lucas cited Bessent's prior comments describing the current deposit insurance framework as a systemic vulnerability that disadvantages small banks and leads consumers to prefer large institutions in times of crisis. He asked whether a targeted expansion of deposit insurance for non-interest bearing transaction and payroll accounts would strengthen financial stability.

Bessent agreed such a measure would be positive, saying the widespread perception that the largest depositors will be made whole in a crisis has distorted the market, pointing to the fallout from the 2023 banking turmoil, when deposits fled out of small banks and into big banks.

"Much of that is what is known as the 'payroll account,'" Bessent said. He added that allowing small banks to offer a single non-interest bearing account with "a much higher level of insurance" would help them hold onto deposits during periods of stress.

Bessent did not specify what the ideal higher level would be, nor endorse a particular legislative proposal. But he linked the current framework to long-term consolidation, arguing that deposit insurance disparities are "one of the reasons we have seen assets leave small banks" and "one of the reasons that we have seen 50% of small banks disappear."

The exchange comes as lawmakers are debating targeted deposit insurance expansions for business transaction accounts, with recent bipartisan proposals circling around covering levels of deposits well above the standard $250,000 cap.
2h 22m ago

Waters initiates testy exchange over inflation

By Ebrima Santos Sanneh
About Ebrima Santos
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Rep. Maxine Waters
House Financial Services Committee ranking member Maxine Waters, D-Calif.
Bloomberg News
House Financial Services Committee ranking member Maxine Waters, D-Calif., entered into a heated exchange with Treasury Secretary Scott Bessent over whether the White House's tariff regime has contributed to stubbornly high inflation.

Waters pressed Bessent on inflation, tariffs, and his past statements reportedly opposing tariffs to investors, accusing him and the Trump administration of failing to address the costs of tariffs on consumers while privately acknowledging their inflationary effects.

Waters cited the Treasury's FSOC annual report, noting that while Bessent had touted economic growth and deregulation as tools for financial stability, he "said little about the harms of inflation," despite rising prices and affordability being ongoing concerns for American households. She pointed to Bessent's recent media appearances acknowledging high prices and asked whether, as a hedge fund manager in 2004, he had warned investors that "tariffs are inflationary," as reported by the New York Times. 

Bessent flatly denied making such a statement and dismissed reporting to the contrary, expressing skepticism about the accuracy of the claim Waters cited.

Waters then cited a Fox News interview last November in which Bessent said the government would reduce tariffs on goods like coffee and bananas to "bring the prices down very quickly." If tariffs are not inflationary and are "paid for by foreign countries," Waters asked, why would cutting tariffs be necessary to lower prices for U.S. consumers?

"That's the Trump logic," Waters said, "but that isn't reality."

She argued that tariffs had hiked prices "across the board," and questioned the logic behind placing tariffs on goods the U.S. does not produce domestically, saying such policies "only serve to punish the American consumer."

Waters also linked tariffs to the worsening housing affordability crisis, noting that the administration placed tariffs on underlying housing inputs, including lumber, steel, and appliances. As Bessent attempted to cut in and respond, Waters repeatedly reclaimed her time, cutting him off.
2h 33m ago

Hill builds support for community bank package

By Claire Williams
About Claire
byclairew
French Hill
House Financial Services Committee Chair French Hill, R-Ark.
Bloomberg News
Chairman of the House Financial Services Committee French Hill, R-Ark., got the support of Treasury Secretary Scott Bessent for a regulatory tailoring package for small banks. 

Hill, a former community banker himself, has tried to make community bank legislation a hallmark of his tenure atop the committee. His efforts have hit some roadblocks though, as crypto and other priorities have taken time on the committee. 

The support of the administration could be key to getting a community bank package through the committee, and then to get time in the Senate. Bessent said that community banks should have tailored capital and risk standards. 

"It's Main Street's turn, and essential to Main Street having its turn are small community banks," Bessent said. "Thanks to onerous regulation … community and small banks became too small to succeed."
2h 57m ago

Bessent: 'Stagnation is itself a threat to financial stability'

By Claire Williams
About Claire
byclairew
Scott Bessent speaks at a House Appropriations Subcommittee on Financial Services and General Government hearing.
Treasury Secretary Scott Bessent.
Bloomberg News
Treasury Secretary Scott Bessent outlined a program of financial deregulation in his prepared testimony for the House Financial Services Committee oversight hearing for the Financial Stability Oversight Council. 

"Regulation by reflex has led to a regulatory myopia that has undermined safety and soundness," Bessent said in his prepared remarks. 

Bessent blamed Biden-era bank regulation and a focus on "reputation risk" and climate-related financial risk for the Silicon Valley Bank Crisis, repeating a narrative espoused by many Republicans in Congress at the time. 

"Besides undermining safety and soundness, regulation by reflex has driven excessive regulation," Bessent said. "That can lead to economic stagnation. And economic stagnation is, itself, a threat to financial stability."

Bessent said that federal agencies "must avoid the temptation to create a zero-risk financial

system, which would result in what others have called, 'the stability of the graveyard.'"

"FSOC should aim to identify vulnerabilities that could lead to systemic crises and encourage the private sector to mitigate those risks before recommending additional regulation. FSOC should also work with its members to support efforts to avoid or pare back existing regulation that stifles pro-growth lending, capital formation, and innovation," he said. "And the best way to achieve these goals is by centering economic growth and economic security at the heart of FSOC's agenda."
3h 22m ago

CDFIs in focus

By John Heltman
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Crapo Bessent
Senate Finance Committee Chair and Community Development Financial Institution Caucus co-chair Mike Crapo, R-Idaho, right, and Treasury Secretary Scott Bessent in January 2025.
Bloomberg News
Bessent is all but certain to face questions about the Treasury's handling of its Community Development Financial Institution Fund, which has been in limbo since President Trump issued an executive order directing Treasury to dismantle the program to the maximum extent allowed by law. 

Bessent responded to the order by issuing a memorandum to the White House Office of Management and Budget — headed by Russell Vought, who is also serving as acting Consumer FInancial Protection Bureau director — explaining that all of the Fund's programs are statutorily required and therefore unable to be cut. Despite that finding, OMB documents from last year showed that OMB had allocated only $35 million to the program to cover administrative costs, with no funding allocated for program awards and grants.

Those funds, while relatively small by government appropriations standards, have an outsized impact on rural and other underinvested communities wherethere are a small number of lenders and limited economic opportunity. CDFIs have complained that the resources made available through CDFI Fund programs are critical to their ability to lend, and lending is a critical element of fostering a thriving business community. 

Bessent may face tough questions on CDFIs from both sides of the aisle — last year, 105 Republican members of Congress sent a letter to the White House urging a restoration of the fund and its programs, which they said "play an important role in supporting economic development in rural, tribal and other underserved communities in our states." The banking industry has also weighed in, with a number of banking trade associations sending a letter to the White House urging the administration to restore funding.
Claire Williams
Reporter, American Banker
Ebrima Santos Sanneh
Reporter, American Banker
John Heltman
Washington Bureau Chief, American Banker
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