Boehner noncommittal on Export-Import Bank; Fed gives banks more times on plans

June 24, 2014
TRADE
Boehner hedges on Export-Import Bank

House Speaker John A. Boehner (R-Ohio) declined Tuesday to endorse reauthorizing the ­Export-Import Bank, an entity many large corporations consider critical for doing business abroad. Boehner said he would consult with Republican colleagues in the coming weeks before deciding how the House should proceed.

The bank’s existence has become the latest flash point between business leaders and conservatives who view the entity is a form of “corporate welfare.” Boehner’s comments are a notable departure from his previous support for reauthorizing the bank, which makes loan guarantees to foreign customers buying from U.S. exporters, especially large aviation firms and defense contractors.

Boehner described the debate as a “rather controversial subject” and said his previous support for the bank didn’t matter now that he is speaker.

“I’ve got a different job than I had then,” he told reporters. “My job is to work with our members to get to a place where the members are comfortable. Some people believe that we shouldn’t have it at all, others believe that we should reauthorize it with significant reforms, and we’re going to work our way through this.”

Boehner’s comments follow remarks by incoming House Majority Leader Kevin McCarthy (R-Calif.), who said Sunday that he supports letting the bank’s charter expire Sept. 30. The Club for Growth and some other conservative groups immediately heralded McCarthy’s comments.

Whether to reauthorize the bank will be the subject of a closely watched hearing of the House Financial Services Committee on Wednesday. The panel is chaired by Rep. Jeb Hensarling (R-Tex.), one of the bank’s most strident critics.

— Ed O’Keefe

BANKING
Fed gives extensions to meet ‘stress tests’

The Federal Reserve said Tuesday that it is giving Citigroup and three other big banks another six months to amend their capital plans, changes required after they fell short in the Fed’s annual “stress tests.”

The Fed said it is extending to Jan. 5 the deadline for the third-largest U.S. bank and the U.S. divisions of Britain’s HSBC and the Royal Bank of Scotland, as well as for Spain’s Banco Santander.

The original deadline was Thursday.

In the March stress tests, the Fed ruled that the banks’ capital plans were inadequate. That prevented them from raising their dividends or boosting their stock buybacks.

Citibank has been cutting jobs and trimming some businesses in an effort to improve its ­finances.

Thirty banks underwent the tests to determine if their capital buffers were sufficient to allow them to keep lending through a financial crisis.

— Associated Press

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