By Katanga Johnson
WASHINGTON (Reuters) – The head of the U.S. Consumer Financial Protection Bureau (CFPB) said on Tuesday that financial regulators are expected to convene within the next 10 days to discuss the systemic risks and economic implications of the coronavirus outbreak.
Kathy Kraninger, in response to a grilling by members of the Senate Banking panel about how regulators were responding to the outbreak and resulting market turmoil, said that the Financial Stability Oversight Council would meet soon to discuss the matter, but that the specific date was not yet public.
“There is already extensive communication among the FSOC members through the interagency process,” Kraninger told lawmakers.
“Collectively the regulators are in routine conduct with institutions we regulate and have been ensuring prompt responses to their inquiries as well.”
U.S. markets plunged again on Monday amid fears the virus will cause a global recession, triggering a 15-minute trading halt in stocks. Wall Street rose 1% on Tuesday as investors pinned their hopes on policy easing by major central banks after global markets plummeted in the previous session on fears of a coronavirus-driven recession.
The virus has spread to 113 countries, infecting more than 111,600 people, according to a Reuters tally based on statements from health ministries and government officials.
Congress created FSOC, which comprises the leading financial regulators including the CFPB, the U.S. Federal Reserve and the U.S. Treasury Department, to monitor potential systemic threats to financial markets following the 2007-2009 financial crisis.
Investors are watching closely for signs of distress in key credit markets or liquidity problems, and for any signal that regulators may take actions to support those markets or to arrest a further decline in stocks.
Also on Tuesday, Kraninger said that the agency has home-working contingency policies for “nearly” all of the agency’s employees, as the coronavirus has closed in on the U.S. capital.
The efforts by the CFPB comes amid moves by other financial watchdogs to prepare contingency arrangements, including travel restrictions and home-working, to ensure they can effectively oversee the financial markets during disruption.
(Reporting by Katanga Johnson; Editing by Michelle Price, Franklin Paul and Cynthia Osterman)
