Bye-bye Dodd-Frank? What Donald Trump’s win means for the banking red tape
Donald Trump's victory for the White House could spell the end of a key piece of banking regulation, but only if he can convince others to get on board.
Trump has previously pledged to repeal the Dodd-Frank Act, an extensive set of reforms designed to address risk on Wall Street following the financial crisis which was brought in by President Barack Obama.
"While a reduction in regulatory compliance costs would bolster bank earnings, reduced oversight and a roll-back of requirements would also result in a weakening a of banks' capital and liquidity positions," noted a report from credit rating agency Moody's.
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However, even if Trump is serious about shaking up banking red tape, it's possible not everybody will feel the same way, which means the new President may not get what he wants.
Monica Gogna, financial regulation partner at Ropes & Gray, told Morning Wire: "I wonder how high this will be on Trump's priority list in January and, if it were high on his priority list, which I wonder about, one of the things that he's going to have to grapple with is the existing system of checks and balances within the US governmental system."
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Meanwhile, a report prepared by law firm Dentons noted that, given recent scandals in the banking sector, such as Wells Fargo setting up two million accounts without customer approval, there could be some reluctance to loosen up on the industry.
"It's also important to recognise, notwithstanding that this was a Republican candidate for office, a significant aspect of the politics that drove him to victory is really a populous message," Mike Zolandz, co-head of Denton's public policy and regulatory practice, told Morning Wire
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