“The major driver of the growth in private credit has always been to get around regulations,” said Andrew Park, a senior policy analyst who focuses on private credit at Americans for Financial Reform, a Washington-based coalition of consumer and investor advocates. He pointed to previous ways risk has shifted to non-bank markets when new rules are imposed. “The answer is not loosening bank regulations but rather properly monitoring and containing the risks in the private-credit market,” he said.
Aditi Sen, managing director of research and campaigns at Americans for Financial Reform Education Fund … said KKR’s investment in LNG helped fuel a rapid expansion in the US with negative climate impacts. “Like coal-powered plants — there are examples of debt-driven dividend recaps, saddling portfolio companies with interest payments, charging exorbitant management fees; none of that is going to the type of capital-intensive activity that an actual transition would require,” said Sen.
Doing so would “decrease burdensome energy costs for future homeowners and renters, which in turn may help lower default risks and loan delinquency rates, and set forth a path to stabilize our shaky housing financial system,” said Jessica Garcia, senior policy analyst for climate finance at Americans for Financial Reform Education Fund. “Implementing up-to-date energy codes will help ease the financial strain on homeowners and renters across the country as they fight to remain housed,” Garcia said. “We are encouraged by HUD’s decision, and urge the Federal Housing Finance Agency to follow suit and swiftly adopt the latest energy efficiency codes.”
Alexa Philo and Patrick Woodall of Americans for Financial Reform: “Picture a new megabank with all the advantages and dangers of a too-big-to-fail institution. Now imagine it had the market power to bully merchants through its ownership of a payment network for debit and credit cards. Finally, throw in a track record of gouging its own customers. That’s exactly what we will have if Capital One succeeds in taking over Discover Financial Services.”
Carter Dougherty, the communications director at Americans for Financial Reform (and a former reporter for The Times) … “With executive compensation linked to bank share prices, you realize the incredibly self-interested case that the bank lobby makes against more equity/capital: it lowers banker compensation.”
“There are changes that fiddle at the edges of a problem and there are reforms like this one that will save consumers billions each year by slashing a particularly nasty kind of junk fee,” said Amanda N. Jackson, director of consumer campaigns at Americans for Financial Reform, which has advocated for stronger federal financial regulation.
