Magazine article American Banker

Think You've Seen the Trump Effect on Regulation? Just Wait

Magazine article American Banker

Think You've Seen the Trump Effect on Regulation? Just Wait

Article excerpt

Byline: Victoria Finkle

The banking industry has sought to reduce its regulatory burden for years -- and it's now finally poised to see some tangible results.

The House is expected to take up a sizable regulatory relief package on Tuesday, while the Senate is readying a vote to confirm Jelena McWilliams as chair of the Federal Deposit Insurance Corp., rounding out the Trump administration's bank regulatory team.

Of course, banking insiders have been talking about reforms to the Dodd-Frank Act and the changing of the guard at the banking agencies since President Trump's upset victory in 2016. And while officials including acting Consumer Financial Protection Bureau Director Mick Mulvaney have been working quickly to reopen some Obama-era rules, the wave of changes is just beginning. Having these two pieces fall into place simultaneously is a big milestone for an industry that's come under heightened scrutiny and tougher rules for the better part of a decade.

Republican lawmakers are said to be pursuing an additional package of regulatory changes, but it's unclear whether that will gain serious momentum before the closely watched midterm elections.

Yet with the McWilliams confirmation moving forward, the groundwork is being laid for more deregulatory efforts at the agencies. That's where the industry's focus -- and influence -- is likely to turn from here.

Already, the Federal Reserve and the Office of the Comptroller of the Currency, now overseen by Trump-appointed officials, have taken steps to reduce capital constraints on some of the country's largest banks. With McWilliams, a former Fifth Third attorney, installed at the FDIC, regulators will be able to go even further in making multi-agency changes to Dodd-Frank measures, likely starting with highly anticipated reforms to the Volcker Rule, a ban on proprietary trading.

"Her confirmation is a game-changer," said J. …

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