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ASA Statement Ahead of House Financial Services Hearing on Fed’s Role as Lender of Last Resort



WASHINGTON, D.C. – The American Securities Association (ASA), in advance of today’s U.S. House Committee on Financial Services Financial Institutions & Monetary Policy Subcommittee hearing, sent a letter to Subcommittee Chairman Andy Barr (R-KY) and Ranking Member Bill Foster (D-IL) urging Congress to ensure the Federal Reserve Board not exclude dealers who serve middle market businesses, municipalities, and households in future times of market disruption and episodic stress.

 

“We are concerned that the Federal Reserve Board’s future decisions to create credit facilities in a time of market stress could exclude non-Wall Street dealers who serve middle market businesses, municipalities, and households across the country,” said Chris Iacovella, President & CEO of the American Securities Association. ”We believe this would be a huge mistake and the Board must use its broad authority to grant non- primary dealers with good collateral to access any credit facility it creates in response to an economic or financial crisis. Wall Street firms do not serve the small businesses and municipalities that our firms serve, and we hope Congress will take measures to require the Board not to forget that.”

 

Read the American Securities Association’s letter here

 

In April 2020, ASA sent a letter to Federal Reserve Chairman Jerome Powell urged the Federal Reserve to use its authority to authorize a “Main Street” non-primary dealer credit facility to expand credit to the broader economy in the wake of market turmoil caused by the COVID-19 outbreak. The call came after the Federal Reserve created a Primary Dealer Credit Facility (PDCF) which served primary dealers of the Federal Reserve Bank of New York.

 

 

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About the American Securities Association

 

American Securities Association, based in Washington, DC, represents the retail and institutional capital markets interests of regional financial services firms who provide Main Street businesses with access to capital and advise hardworking Americans how to create and preserve wealth. ASA’s mission is to promote trust and confidence among investors, facilitate capital formation, and support efficient and competitively balanced capital markets. This mission advances financial independence, stimulates job creation, and increases prosperity. The ASA has a geographically diverse membership of almost one hundred members that spans the Heartland, Southwest, Southeast, Atlantic, and Pacific Northwest regions of the United States.

 

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