Wednesday, 23 May 2018

US to ease crisis-era Dodd-Frank banking rules



A move to relax US banking rules approved after the financial crisis has cleared its final stage in Congress.

 
The House of Representatives voted 258-159 to approve the measure, sending it to the president to sign into law.


The bill, which won some bipartisan support, reduces the oversight requirements for banks with less than $250bn in assets, among other measures.


Supporters say it will help banks grow, but critics say it could mean a return to reckless behaviour among lenders.


Republicans, including President Donald Trump, have repeatedly pledged to repeal 2010 financial regulations known as Dodd-Frank.
They argued that the law was overly complex and costly, putting smaller banks at a disadvantage and inhibiting economic growth and lending.


Among other things Dodd-Frank required large financial institutions:

  • To hold more money to use in the event of a financial shock
  • To have increased protections for consumers such as those taking out mortgages
  • And to use improved stress tests aimed at measuring their ability to withstand a severe economic downturn.
It also made banks with more than $50bn in assets automatically subject to strict levels of oversight.


Following the amendments, only about a dozen financial institutions will be automatically subject to the strictest rules.




BBC     News.