Overnight Finance: Sanders, Clinton take the gloves off in Wall Street fight

SANDERS INTERVIEW SPARKS PRIMARY FIGHT: Bernie Sanders’s comments to the New York Daily News about banks are at the center of the biggest fight in the Democratic presidential primary to date.

Sanders has frequently used Wall Street as a cudgel against rival Hillary Clinton, but the muddy interview allowed Clinton to put him on defense over what has been his core strength.

It was a surprising turn of events and one that has led to the most bitter stretch yet in the contentious race for the Democratic nomination. The Hill’s Peter Schroder breaks it down: http://bit.ly/20bVKeA.

{mosads}CFPB DIRECTOR FIGHTS BACK: Richard Cordray, director of the Consumer Financial Protection Bureau (CFPB), defended its record Thursday before critical Republican senators, who charged it with preferring punitive action over transparent rules and stifling the country’s credit market through unaccountable actions.

Cordray told the Senate Banking Committee today that the agency’s actions to crack down on allegedly discriminatory auto loans and predatory lending were helping the economy and consumers, not limiting access to financial products.

“I don’t want to be viewed as some happy talker who sees the glass half-full when there’s just a few drops in it,” said Cordray. But “we see credit beginning to expand again in the mortgage market and the credit card market.” I’ve got your recap here: http://bit.ly/1PX8eiE.

SENATORS POINT FINGERS AFTER SEC NOMINEE VOTE FALLS THROUGH: The Senate Banking Committee postponed a vote on five Obama administration nominees Thursday after an apparent agreement to approve them as a group fell through.

The five nominees were grouped together en bloc for one vote. But the vote that was postponed after several Democrats and one Republican spoke out against two nominees to the Securities and Exchange Commission (SEC): Lisa Fairfax, a Democrat, and Hester Peirce, a Republican.

Several Democrats voted against the bloc, blasting Fairfax and Peirce for not being clear about whether they’d support the SEC’s rule requiring companies to disclose political campaign contributions.
Those Democrats attempted to clarify during the vote that they were only opposing the two SEC nominees, not the other three on the slate. I walk you through the confusion here: http://bit.ly/22g8bFD.

SENATORS CALL FOR TREASURY ‘PANAMA PAPERS’ PROBE: Sens. Elizabeth Warren (D-Mass.) and Sherrod Brown (D-Ohio) are urging the Treasury Department to investigate any involvement of U.S. or U.S.-linked companies with the law firm at the center of the Panama Papers.

The Justice Department is already conducting a review of the Panama Papers. But in a letter sent to Treasury Secretary Jack Lew on Thursday, Warren and Brown said Treasury should to do its own investigation, because it is “the primary agency charged with protecting the integrity of the U.S. financial system and enforcing our laws against money laundering and terrorist financing.” The Hill’s Naomi Jagoda gets you up to speed: http://bit.ly/1S0kT8U.

HAPPY THURSDAY and welcome to Overnight Finance, where we’re eagerly awaiting a clip of Ted Cruz singing in a matzo factory and are absurdly jealous of John Kasich’s lunch. I’m Sylvan Lane, and here’s your nightly guide to everything affecting your bills, bank account and bottom line.

Tonight’s highlights include pushback from Pfizer, criticism from GE, a Democratic law on payday loans and fallout from the MetLife case.

See something I missed? Let me know at slane@digital-release.thehill.com or tweet me @SylvanLane. And if you like your newsletter, you can subscribe to it here: http://www.digital-release.thehill.com/signup/48.

LEW SLAMS METLIFE COURT RULING: Treasury Secretary Jack Lew is trashing a court ruling that upended new powers granted to financial regulators.

In a lengthy statement issued Thursday, Lew said a recent decision by a judge to overrule financial regulators on whether the life insurance company MetLife merited stricter regulation was misguided and dangerous.

“I strongly disagree with the court’s ruling,” he said. “This decision leaves one of the largest and most highly interconnected financial companies in the world subject to even less oversight than before the financial crisis.” Here’s more from Peter Schroeder: http://bit.ly/1Vc7TAr.

PFIZER SPEAKS OUT AGAINST INVERSION RULE: Pfizer CEO Ian Read slammed the Treasury Department’s new actions targeting offshore tax deals, saying they were a “shot” at the pharmaceutical company’s now-canceled merger with Irish-based Allergan.

“This week’s Treasury action interprets the tax laws in ways never done before,” Read said in a Wall Street Journal op-ed late Wednesday.

“This ad hoc and arbitrary attempt to single out and damage the growth opportunities of companies operating within the current law is unprecedented, unproductive and harmful to the U.S. economy.”

Pfizer and Allergan announced Wednesday that they had terminated their planned $160 billion merger in light of guidance Treasury issued Monday to curb tax inversions, transactions in which U.S. companies reincorporate overseas for tax purposes after merging with foreign companies. The merger would have allowed Pfizer to move its legal residence to Ireland, which has a lower corporate tax rate. Naomi Jagoda has more: http://bit.ly/1YhJW99.

REPORT: SANDERS PLAN WOULD ADD TRILLIONS TO DEBT: Democratic presidential candidate Bernie Sanders’s proposals would add $2 trillion to $15 trillion to the national debt, an analysis published Thursday found.

The range is due to differing estimates about the cost of Sanders’s healthcare plan, and the figures include net interest, the Committee for a Responsible Federal Budget (CRFB) said in its report.

While Sanders “deserves a great deal of credit for proposing specific and serious offsets for his spending proposals,” his offsets “would fall significantly short of the costs,” CRFB said: http://bit.ly/1SDpj32.

JOBLESS CLAIMS DROP BY 9K: First-time jobless claims maintained their historic hot streak last week, holding below 300,000 for more than a year.

Applications for unemployment insurance fell by 9,000 last week, to 267,000, the 57th straight week below 300,000 and longest stretch since 1973, the Labor Department said Thursday.

The four-week moving average of claims, which is a better gauge for the direction of the labor market, rose by 3,500, to 266,750. The Hill’s Vicki Needham breaks it down: http://bit.ly/1TEJeUd.

GE CEO BLASTS SANDERS: General Electric’s CEO Jeffrey Immelt on Thursday blasted Democratic presidential hopeful Sen. Bernie Sanders (I-Vt.) for saying the company represents the corporate greed of Wall Street.

Immelt criticized Sanders for never visiting GE’s Vermont businesses, for failing to recognize the firm’s contributions to bolstering U.S.-manufacturing, for not understanding that global companies must have outposts in other countries and for falsely asserting that the multi-national business pays zero in taxes.

“GE has been in business for 124 years, and we’ve never been a big hit with socialists,” Immelt wrote in a Washington Post op-ed on Thursday. Vicki Needham has more: http://bit.ly/1MWDjIJ.

DEM BILL CRACKS DOWN ON PAYDAY LENDERS: Senate Democrats are looking to crack down on payday lenders.

The Stopping Abuse and Fraud in Electronic (SAFE) Lending Act introduced Thursday by Sen. Jeff Merkley (D-Ore.) would deliver a blow to payday lenders that critics say charge dangerously high interest rates and fees on short-term loans.

The SAFE Act would block payday lenders from taking money out of borrowers’ bank accounts without their permission through what is known as a “remote check.” It also targets a number of fees charged by payday lenders.

“These payday loans pull families into a vortex of debt,” Merkley told reporters. “Once they have the checking account number, they can reach in with checks they generate and take money out of a consumer’s checking account at will,” he said. The Hill’s Tim Devaney explains: http://bit.ly/1Xk9q5q.

HOME LOAN DELINQUENCIES KEEP FALLING: Consumers made their home equity loan payments on time during the final quarter of last year with the help of an expanding economy, another sign of the housing market’s improving health, a new survey shows.

Delinquencies fell significantly in home equity loans and lines, continuing a downward trend that is approaching their 15-year averages for the first time since the recession, according to the American Bankers Association’s (ABA) Consumer Credit Delinquency Bulletin released on Thursday.

Home equity loan delinquencies fell to 2.68 percent, from 2.91 percent, of all accounts and home equity line delinquencies dropped to 1.18 percent, from 1.31 percent, of all accounts during the October-December period: http://bit.ly/1NbRUuu.

NIGHTCAP: The Postal Service is cutting the price of stamps!

Write us with tips, suggestions and news: slane@digital-release.thehill.com, vneedham@digital-release.thehill.com; pschroeder@digital-release.thehill.com, and njagoda@digital-release.thehill.com. Follow us on Twitter: @SylvanLane,  @VickofTheHill; @PeteSchroeder; and @NJagoda.