How Trump’s Deregulation Drive Could Impact Banks

Karen Solomon and Michael Reed’s commentary was included in an article appearing in The Banker analyzing how larger U.S. banks are most likely to be positively impacted by the expected general deregulatory environment under a second Trump administration. They share what they anticipate from a second Trump term.

“I wouldn’t go so far as to say that there’ll be no revisions to the liquidity rules, because there was a press for that again after the Silicon Valley failure last year," Karen said. “But I don’t think we’re going to see new liquidity proposed rules soon,” she adds. She also noted Trump campaigned on capping credit card interest rates at 10 per cent, and “we’ll see if that gets legislated.” Karen continued, stating that “we are expecting substantial change in the leadership at the banking agencies, which might mean that the regulators will be more favorably inclined looking at transactions that wouldn’t have passed muster in the Biden administration.”

Michael comments on policy statements by the OCC and FDIC that heightened scrutiny on bank mergers resulting in an entity with more than $100 billion of assets, saying he expects the new government to “rip up” those policy statements. “It’s sort of back to where it was in the first Trump administration in terms of regulators being more willing to approve M&A deals, even for banks crossing those $50 billion or $100 billion thresholds,” he said.