WASHINGTON, DC – U.S. Senator Jack Reed (D-RI), a senior member of the Banking Committee, is extremely concerned about the lack of prudent leadership at the Office of the Comptroller of the Currency (OCC), which oversees more than 1,400 banks.

Reed, who earlier this year took the OCC to task for not using its significant authority to hold banks and mortgage servicers accountable for past foreclosure misdeeds, said he is troubled by the most recent remarks of the Acting Comptroller of the OCC, John Walsh, who yesterday called current banks capital levels “extraordinarily high.”  Reed stated: 

“Mr. Walsh seems to have developed a dangerous case of amnesia – seemingly forgetting that banks failed and didn’t have enough capital, forcing taxpayers to bail them out.

“Excessive short-term oriented risk taking by banks, borrowers, and investors was a significant contributor to the financial crisis together with lax regulation that tolerated inadequate capital levels. 

“Mr. Walsh’s suggestions that capital requirements should be reduced are counter to what every other regulator has told us.  Just last week, staff from the OCC told the Senate Subcommittee on Financial Institutions and Consumer Protection that the “financial crisis underscored the importance of strong capital cushions” and that the OCC was working to “strengthen capital and liquidity standards.”  

“Mr. Walsh’s latest comments provide further evidence that he is not interested in leading an agency charged with ensuring the safety and soundness of our financial institutions.  

“Accordingly, I join my colleague, Senator Levin, in asking the Obama Administration to fundamentally re-think the OCC’s leadership and ensure that American taxpayers are never again on the hook for Wall Street’s misdeeds.”