BANKING/TREASURY: “Bipartisan legislation expected to clear the Senate as early as this week has just one provision that is set to directly benefit the nation’s megabanks: a section aimed at making it easier for them to buy state and local bonds.
The provision, championed by Citigroup Inc. and other large banks, would ease a new rule aimed at ensuring banks can raise enough cash during a financial-market meltdown to fund their operations for 30 days, requiring them to hold more cash or securities that are easily salable… The Senate on Tuesday voted 67-32 to formally begin debate on the bill, which primarily benefits small and medium-size banks, easily reaching the 60 votes needed and signaling that the measure has enough support from Democrats to pass by a comfortable margin. The legislation was backed by 16 Democrats and one independent, Maine Sen. Angus King, bucking Massachusetts Sen. Elizabeth Warren and 31 other Democrats who opposed the procedural vote.
Including the municipal-bond provision in the deregulatory bill was a priority for the nation’s biggest banks that buy a lot of municipal securities as investments. A Citi lobbyist recently told a Senate staffer that the firm would be pleased if easing the treatment of municipal debt under the bank-funding rule was the one thing it could accomplish during the current Congress, according to a person familiar with the conversation.
A spokesman for the bank declined to comment on the remark.
State and local officials have praised the move, saying their securities could suffer if banks begin to shun them.”
-Andrew Ackerman, “Big Banks Get a Big Win in Senate Rollback Bill,” The Wall Street Journal online, Mar. 6, 2018 12:05pm