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BofA won't fight Obama's plan for consumer watchdog agency

The banking industry is adamantly opposed to the Obama administration’s proposal for a Consumer Financial Protection Agency.

But in its fight to derail the idea, the industry won’t get help from one of its biggest names: Bank of America Corp. Under new Chief Executive Brian Moynihan, who took over Jan. 1, BofA has decided that it won’t formally oppose creation of the watchdog agency, Bloomberg News reports:

Moynihan informed White House and U.S. Treasury Department officials of the company’s stance last month, bank spokesman James Mahoney said in an interview. While not endorsing the agency, the bank agrees with the “policy direction,” Mahoney said.

“We’ve made it clear to various organizations of which we are part that we aren’t lobbying against the agency,” Mahoney said. The bank also isn’t promoting the concept, leaving the decision to Congress and U.S. agencies, he said.

Moynihan, 50, has been trying to repair the megabank’s image in Washington after the stormy tenure of previous CEO Ken Lewis.

Brianmoynihanbofa The Wall Street Journal reported this week that Moynihan “spent five of his first 13 working days as CEO in Washington. People close to the bank say he wants to revamp the company’s recalcitrant reputation, have a voice in new legislation and avoid a rerun of last year’s sparring with U.S. officials, which led to regulatory handcuffs, a forced overhaul of the bank’s board and Mr. Lewis’ departure.”

His banker peers may believe that Moynihan is being naive in dealing with regulators, but he seems to be genuinely interested in accommodation.

Interviewed after he had a private meeting with other financial CEOs at the World Economic Forum in Davos, Switzerland, this week, Moynihan told Bloomberg:

A lot of the discussion is how do we get engaged, how do we make sure that we are shaping the dialogue [with regulators] in a way that balances all of the things that we want to make sure don’t happen with all of the things we want to make sure do happen.

Apparently, the Consumer Financial Protection Agency is not on Moynihan’s list of things that he couldn’t live with as a banker -- despite the rest of the industry’s fierce opposition.

-- Tom Petruno

Photo: Bank of America CEO Brian Moynihan. Credit: Pierre Verdy / AFP / Getty Images

 
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