Financial Debate Renews Scrutiny on Banks’ Size
New York Times – A group of Senate Democrats introduced a bill on Wednesday that would require three of the nation’s largest banks to shrink, in an effort to eliminate the problem of financial institutions being seen as “too big to fail,” The New York Times’s David M. Herszenhorn and Sewell Chan report from Washington.
Their proposal, which would put specific ceilings on the size of banks, builds on a provision already in the Senate’s financial regulatory overhaul package that is meant to limit future growth of large Wall Street firms.
“The major issue is to keep the banks from getting too large to begin with,” the lead sponsor of the bill, Senator Sherrod Brown, Democrat of Ohio, said Wednesday. “Too big to fail is too big. That’s where we need to be much more aggressive.”
As concern about the risk posed by the biggest financial institutions percolates among populists in Congress and at the Federal Reserve, the lawmakers plan to offer the bill as an amendment to the pending Senate legislation, which could reach the floor as soon as Monday.
