17 November 2016

Financial Times: Bankers predict Trump will not reshape regulatory agenda

The heads of two of the UK’s biggest banks said they expected at most some tweaks to US rules and the direction of global regulations.

Several bankers in New York similarly said they did not expect a broad overhaul, while Goldman Sachs’ chief operating officer Gary Cohn said earlier in the week that post-crisis regulation was a “huge competitive advantage” for America’s banks.

Expectations of a regulatory reprieve for banks was a major factor in the dramatic rally their share prices have enjoyed since Mr Trump swept to his unexpected victory on November 8.

Republican Congressional leaders have long been critical of the Dodd-Frank reforms introduced in the aftermath of the financial crisis to make the financial system safer. They have proposed a panoply of options, including full repeal, exemptions for smaller banks and elimination of the Consumer Financial Protection Bureau, the new regulator created by the act.

Mr Obama has always stood in their way. The election of Mr Trump, who was critical of Dodd-Frank on the stump, could create an opening for them.

However, Barclays chief executive Jes Staley was cautious saying, “I don’t think there’ll be a huge rowback on regulatory policy. Trump has other more pressing issues.” [...]

Full article on Financial Times (subscription required)

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