As Elizabeth Warren sets up the federal government's new Consumer Financial Protection Bureau, she's been reaching out to bankers skeptical and fearful of the new consumer agency, according to an article in the Wall Street Journal this morning.
According to the story, a wall map of the U.S. in the CFPB offices tracks Warren's banker-outreach campaign with colored push-pins, blue pins representing an in-person meeting with her, a red pin standing for a one-on-one call with her and a white pin a group meeting. The map has 47 pins so far.
Warren told Texas community bankers in January that she wants to "make sure that there is a robust, diversified financial-services industry." She said the CFPB will focus its attention on policing 80,000 nonbank firms that are involved in payday loans, student lending, debt collecting and the mortgage business, but that now largely escape regulation. She's told Oklahoma community bankers that traditional community banks didn't cause the financial crisis and that they and the CFPB could be allies.
Warren has also met with top bank chiefs at J.P. Morgan Chase, Citigroup and UBS AG's U.S. division, the article said.
Why is she going to such lengths to improve her standing with the financial industry? "Historians of government say agencies need to make a strong start or they are likely to have long-term credibility problems," the article surmises.
But the article also quoted Jaret Seiberg, a Washington analyst with MF Global, saying, "There's still tremendous distrust between much of the financial sector and Elizabeth Warren. She has been talking of moderation, but there's a lot of fear...that once the CFPB is up and running and it has a director, that the agency is going to be able to use its unprecedented powers with almost no checks and balances to fundamentally alter the consumer banking business."