On Tuesday, June 30, the House Committee on Financial Services held its first quarterly oversight hearing mandated by the CARES Act featuring Treasury Secretary Steven Mnuchin and Federal Reserve Chairman Jerome Powell. Democratic Representatives focused on the impact communities of color faced during the pandemic, and several Republicans expressed concerns about the commercial real estate market. Secretary Mnuchin expressed his commitment to work with Congress in July on further COVID-19 relief legislation, and Chairman Powell reaffirmed the Fed would continue to use its tools for as long as it saw necessary to keep the economy on the path to recovery.  Additionally, Rep. Blaine Luetkemeyer (R-MO) asked both Chairman Powell and Secretary Mnuchin about FHFA’s recent Enterprise Capital Framework proposal, and if it is appropriate for the GSEs to receive meaningful capital credit for sound CRT transactions. Mnuchin responded the GSEs should receive credit, encouraged the GSEs to do Credit Risk Transfers with creditworthy counterparts, and noted that FSOC is examining the issue as well. Powell said the Fed is doing a careful review of FHFA’s Enterprise Capital Framework proposal. 

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