Big bank influence grows: The Clearing House Association merging with Financial Services Roundtable

Merger comes on heels of FSR membership shakeup

Seeking to increase the influence of the nation’s largest banks on the legislative process, two of the nation’s largest banking trading groups are joining forces.

The Financial Services Roundtable and The Clearing House Association are merging, the two groups announced Tuesday.

Both groups boast the nation’s largest groups among their members. The Clearing House Association is one of Wall Street’s largest lobbying groups. The organization is part of The Clearing House, a banking association and payments company that’s owned by the world’s largest banks.

Owners of The Clearing House include Bank of America, Capital One, Citibank, JPMorgan Chase, PNC Bank, Santander, SunTrust, UBS, U.S. Bank, Wells Fargo, and others.

The Financial Services Roundtable recently shifted its focus to issues facing the nation’s largest banks.

Politico reported earlier this year that the board of the FSR voted late last year to “pare down its membership only to banks with more than $25 billion in assets,” in order to allow the group to focus solely on big bank issues and lobby on their behalf.

The move, reportedly led by Bank of America CEO Brian Moynihan, cut the FSR’s membership from more than 80 members to just over 40, with the expulsion of insurers, asset managers, and some nonbanks.

That move left the group’s membership limited to banks like Citi, JPMorgan Chase, U.S. Bank, Wells Fargo, and the like.

And now, the two lobbying groups that solely represent the nation’s biggest banks are merging.

Upon completion of the merger, TCH Association President Greg Baer will become the chief executive officer for the new organization.

Baer joined TCH Association in 2015 after leaving JPMorgan Chase, where he was the head of regulatory policy.

Prior to serving as JPMorgan Chase’s managing director and head of regulatory policy, Baer also served as JPM’s general counsel for corporate and regulatory law.

Earlier in his career, Baer served as deputy general counsel for corporate law at Bank of America and was a partner at Wilmer, Cutler, Pickering, Hale & Dorr. Baer also spent more than ten years in public service working at the U.S. Department of Treasury and the Board of Governors of the Federal Reserve System

“FSR is shaping and advancing financial service and technology policies that drive the U.S. economy. These two organizations will be stronger together,” said FSR Chairman Brian Moynihan said.

TCH CEO Jim Aramanda said that the merger will create a “premier financial services trade association,” while allowing TCH to focus on its payments business.

“Throughout the last decade, The Clearing House Association has served as an effective advocate for the banking industry through our unique approach of applying data-driven analysis, research and thought leadership,” Aramanda said. “It makes sense to combine the capabilities of two organizations focused on the same goals to create a premier financial services trade association, while The Clearing House continues in its mission of payments innovation and operating core payment systems for the banking industry.”

TCH Chairman Bill Demchak, who is also the CEO of PNC, said that TCH’s other financial business will continue after the merger of the lobbying groups.

“The TCH Association has been a thought leader on key issues in bank prudential regulation, and we expect this combination to expand the reach of its advocacy,” Demchak said. “Meanwhile, the Clearing House Payments Company will continue to operate its payment systems and focus on its new real-time payments system and other payments innovations.”

Baer will take over as CEO of the combined organization as Tim Pawlenty steps down as the CEO of the Financial Services Roundtable.

Last month, the FSR announced that Pawlenty, the former governor of Minnesota, planned to step down this month.

According to the FSR, Chris Feeney, president of FSR’s technology policy division will assume interim responsibility for the group until Baer becomes CEO.

“The combination of these two organizations and their respective research and advocacy strengths further advances FSR’s new strategic focus on banking and payment policies that spur economic growth, increase jobs, modernize cybersecurity policy, and improve financial security for more Americans,” Pawlenty said.

Moynihan added about Pawlenty’s looming departure: “FSR’s members appreciate Tim's leadership in transforming and improving the FSR into a highly regarded policy and research engine for America's leading financial service companies.”

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