Memory lame

23 May 2018 By John Foley Follow @johnsfoley

The first notable revision to post-crisis U.S. financial regulation is more symbol than substance. Minor tweaks aside, large banks will barely notice. Next in the crosshairs is the Volcker Rule, but even so, market changes mean the good old days aren’t coming back any time soon.

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The U.S. House of Representatives voted on May 22 to ease bank rules adopted after the financial crisis. The bill, which was approved by the Senate in March, will go to the White House for presidential signing.

The rewrite of the Dodd-Frank financial law of 2010 would raise the level at which lenders are deemed “systemically important,” a designation that subjects them to detailed oversight by the Federal Reserve.

It also exempts banks with assets of less than $10 billion from the so-called Volcker Rule, which prohibits lenders from engaging in trading for their own gain rather than that of clients.

The Federal Reserve and other regulators are planning to change that rule, which they say places an excessive burden on banks. Vice Chair for Supervision Randal Quarles described it as “complex regulation that is not working well” in March.

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It also exempts banks with assets of less than $10 billion from the so-called Volcker Rule, which prohibits lenders from engaging in trading for their own gain rather than that of clients.

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