With Congress ready to pass the first rewrite of the Dodd-Frank Act, U.S. banks are looking to revise or eliminate more than a dozen other lesser-known rules.
According to Reuters, the banks claim that the rules are outdated, expensive and hinder economic growth.
While many of these rules would have been revised a decade ago, the financial crisis and the controversy over the 2010 Dodd-Frank Act put those changes on hold. However, now that the Senate has passed legislation that would loosen the regulations placed by Dodd Frank, banks are optimistic these other rules will soon follow.
“The feeling is there are many rules that are so old that they’re out of sync with what you need to promote economic growth, and that’s a conversation policymakers are now willing to have,” said Wayne Abernathy, executive vice president at the American Bankers Association, a bank trade group.
The bill, which passed 67 to 31 and had the support of both Republicans and Democrats, relieves more than two dozen banks of regulations that were placed on them under Dodd-Frank.
However, the new bill still leaves many regulations in place. It provides regulatory relief for small, regional banks that have been struggling under the new rules and raises the amount before a lender is deemed too big to fail.
As for the other regulations, there are around 15 rules that bankers and lobbyists want to change, including the Civil War-era False Claims Act; the Securities Act of 1933; the Federal Deposit Insurance Act of 1950; the Bank Holding Company Act of 1956; the Bank Secrecy Act of 1970; a raft of lending laws, including the Community Reinvestment Act of 1977; the Telephone Consumer Protection Act of 1991; the Patriot Act of 2001 and the Sarbanes-Oxley Act of 2002, among others.
“It’s like death by a thousand cuts: This happened over a long period of time … and now a lot of members of Congress, and a lot of consumers and the regulators agree that it’s gone too far,” said Timothy Zimmerman, CEO of Pennsylvania-based Standard Bank and chairman of the Independent Community Bankers of America (ICBA).