Speaking to Fox Business, Mosby stated that the banks’ concern is that once the economic recovery is finished, they may not efficiently manage the capital accumulated over the years. Mosby believes that the banks will potentially not be able to entirely decide on whether to release their capital or not. He projects such a scenario will push the lenders to create extra growth. However, Mosby acknowledged that the big lenders had played a key role in managing the financial crisis. Worth noting is that there are calls for some banks not to fund fossil fuel investments as President Joe Biden spearheads a shift to renewable energy. The director said that such directives are contributing to the fear among banks. He also affirmed that there will always be other smaller banks to step in and fill the gap. However, he cautioned that there is still a risk because the big lenders can easily handle corporate debt. Additionally, the director stated that CEOs of the banks’ are facing an uphill task with different quarters pushing them to make political statements. According to Mosby, such situations present a dilemma for the executives since their stand might impact shareholder relationship.
Wall Street banks CEOs Congress grilling
Over the last few days, U.S. largest banks, including JPMorgan, Bank of America, Morgan Stanley, Citigroup, Wells Fargo, and Goldman Sachs CEOs, faced the Congress following a bumper Q1 2021 earnings. The grilling focused on matters including capitalism, overdraft fees, loans, voting rolls, and climate change. Before the session, the banks lauded their efforts to help customers and the economy through the pandemic, including deferred loan payments and small-business lending. The banks also faced criticisms from some quarters for charging high overdrafts and other fees during the pandemic. Watch the video: Wall Street CEOs hinting at ‘threats’ to capital: Bank advisory director
