Critics on Tuesday of the House passage of the Economic Growth, Regulatory Relief and Consumer Protection Act (S.2155) worry that the Dodd-Frank rollback bill will trigger another financial crisis.
Phil Angelides, former chairman of the Financial Crisis Inquiry Commission, which conducted the nation’s official inquiry into the causes of the 2008 financial crisis, said late Tuesday that the bill rolls back “key financial reforms put in place in the wake of the 2008 financial crisis,” once again putting “our nation’s financial system, economy and taxpayers at significant risk.”
House passage of the bill by a 258-159 vote, coupled with President Donald Trump’s “embrace of financial deregulation and his appointment of regulators committed to the deregulatory agenda, will open the door to reckless risk taking on Wall Street,” Angelides said.
The legislation now moves to the president’s desk, with Trump expected to sign it as soon as the end of this week.
“All attention will now shift towards the Fed to see how they tailor their regulations to adjust to the new legislative framework,” said Ed Mills, policy analyst for Raymond James, in his Washington Policy commentary on Wednesday.
S. 2155 raises the threshold for banks to be considered systemically important from $50 billion to $250 billion, increases the threshold for annual stress tests from $10 billion to $250 billion, among a number of other provisions aimed at regulatory relief for community and regional banks, Mills explained.
Next up for Trump’s deregulatory moves, Mills said, is Senate confirmation of Jelena McWilliams as chairwoman of the Federal Deposit Insurance Corp. — as soon as Wednesday — “completing the confirmation process of the Trump federal bank regulatory team and setting the stage for an increase in bank deregulatory actions going forward.”