FDIC’s McKernan: Agencies should review policies on major asset managers

FDIC Director Jonathan McKernan said regulators should investigate the impact of the “Big Three” asset managers—Vanguard, BlackRock, and State Street—on the banking industry.

Details: Speaking in Washington, McKernan said:

• Regulators should revisit how much of a stake the asset managers can have in the industry without being found to “control” a banking organization, given the growing body of evidence that suggests they are not passive investors.

• Vanguard, BlackRock, and State Street have used their voting power to influence corporate policy, such as by advancing environmental, social, and governance objectives.

• This raises “a real and significant problem” of whether these entities have control over any banking organization, which the banking regulators “need to get in front of quickly.”