Republicans Grill Top Bankers Over China Ties
By Lananh Nguyen, Saeed Azhar, and Scott Murdoch
WASHINGTON/HONG KONG (Reuters)—Top U.S. bankers came under pressure from lawmakers on Wednesday to take a tougher stance on doing business with China amid growing tensions between Washington and Beijing over Taiwan’s sovereignty and China’s human rights record.
During a hearing before the U.S. House Financial Services Committee, Republican congressman Blaine Luetkemeyer pressed bank chief executives on how they would respond in the hypothetical event of a Chinese invasion of Taiwan.
Lawmakers also asked the CEOs to condemn China’s “human rights abuses,” in a departure from previous hearings that tended to focus on domestic issues like housing and consumer protection.
“We will follow the government’s guidance, which has been for decades to work with China,” said Bank of America Chief Executive Officer Brian Moynihan. “If they change that position, we will immediately change it, as we did in Russia.”
JPMorgan Chase CEO Jamie Dimon and Citigroup CEO Jane Fraser both concurred, saying their banks would follow government guidance if China were to invade Taiwan.
The increased scrutiny underscores the challenges the country’s largest lenders increasingly face as they try to balance commercial interests with pressure from policymakers, activists, and investors to take stances on environmental, social, and governance issues.
Wall Street giants including JPMorgan, Goldman Sachs, and Morgan Stanley have sought in recent years to expand their businesses in China, the world’s second-largest economy.
Authorities there have granted U.S. banks more ownership of their securities businesses despite rising geopolitical tension. Despite a bigger footprint, China is not yet a big profit center for those banks.
“There would be few significant gains to the U.S. or losses to China if banks pared back operations there,” said Hong Kong-based Global Source Partners analyst Andrew Collier.
“The symbolism, however, is more important, because China is very concerned about decoupling in trade and imports of key products like semiconductors, so any pressure on the financial sector would send worrisome signals to Beijing.”
Responding to a question about the remarks by U.S. bank CEOs and lawmakers, Chinese foreign ministry spokesperson Zhao Lijian said on Thursday that “the Taiwan
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