American Banker reports the Senate Banking Committee, two years after implementing Dodd-Frank, will likely review the impact of the regulations on the marketplace to determine what may need to be altered. The agenda has not been set yet for the coming year because Committee Chairman Tim Johnson (D-S.D.) wants to consult with the new committee members before releasing a detailed agenda. Now that elections are over, Democrats may be more willing to accept that changes need to be made, and Republican rhetoric has backed away from total repeal of Dodd-Frank to making it more productive. Jaret Seiberg at Guggenheim Securities says, “The real focus is going to be the shift from looking at why banks did bad things to how you can get more credit flowing to the economy. That shift in focus is going to open the door for making modifications to Dodd-Frank.” Passage of any legislation, whether it’s changing the Volcker rule that bans proprietary trading, or the structure of the Consumer Financial Protection Bureau (CFPB), will depend on the committee members relationship and that of the entire Senate. As MHProNews has learned, Amy Friend of Promontory Group, and former chief counsel to the Senate Banking Committee, says lawmakers likely want to see how the CFPB’s qualified mortgage rule, due in January, and the interagency risk retention plan affect the market. “Those will be extremely important in terms of trying to provide some certainty to the private sector,” she says.
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