Republicans warn bank CEOs not to take lightly on social and cultural issues By Reuters

© Reuters. FILE PHOTO: Senator Pat Toomey speaks at the Dirksen Senate Building in Washington, D.C., U.S.A. on May 10, 2022. Tom Williams/Paul via Reuters/file photo/file photo

Written by Pete Schroeder, Lanan Nguyen and Said Azhar

WASHINGTON (Reuters) – The chiefs of the country’s largest banks faced sharp criticism from Republicans on Thursday, as they urged companies to refrain from influencing social and cultural issues.

Senator Pat Toomey, the ranking Republican member of the Senate Banking Committee, urged banks to stop “adopting ESG’s liberal agenda that is hurting America,” as CEOs appeared before Congress for an oversight hearing. Tommy, who frequently supports industry calls for lighter legislation, has argued that companies are off limits when they get involved in non-banking issues like guns and abortion.

“I can’t help but notice that when banks press on highly charged social and political issues, they always seem to swerve to the liberal side,” he said in his opening statement.

Senator John F. Kennedy, a Republican from Louisiana, praised Banks as “not perfect, but good,” before echoing the call to walk lightly.

“You will never win the Uberweek lottery,” he said.

The increased scrutiny is highlighting the challenges that the country’s largest lenders are increasingly facing as they try to balance business interests and pressure from policy makers, activists and investors to take positions on environmental, social and governance (ESG) issues.

The lineup included the chief executives of the four largest US banks: JPMorgan Chase & Co (NYSE:): Jamie Dimon, Wells Fargo (NYSE:) Charles Scharf, Brian Moynihan of Bank of America (NYSE:) and City Group (NYSE:) Jane Fraser. They were joined by the chief executives of the country’s largest regional banks, US Bancorp (NYSE:), PNC Financial (NYSE:) and Trustee.

Democrats have continued their critical stance on the big banks, arguing that they enjoy big profits while mistreating consumers and workers. None of the chief executives present positively agreed to President Sherrod Brown’s request that they remain neutral in any employee union efforts.

However, chief executives said they have begun increasing interest payments to depositors in the wake of the Federal Reserve’s rate hike this week, a trend they expected to continue.

CEOs were in Washington for the second day of hearings. On Wednesday, lawmakers pressed executives to take a tougher line on dealing with China amid heightened tensions between Washington and Beijing over Taiwan’s sovereignty and China’s human rights record.

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