(Photo: Mike Scarcella/ALM)
The U.S. House has approved a sweeping overhaul of bank regulations, sending to President Donald Trump a bill that will give him a chance to make good on his vow to "do a big number" on the Dodd-Frank Act.
Lawmakers voted 258-to-159 Tuesday to advance a measure that is the product of years of financial-industry lobbying to soften post-crisis rules and sensitive negotiations on Capitol Hill to attract bipartisan support needed to get it through the narrowly-divided Senate.
The legislation would be the most significant overhaul of banking oversight to become law since Dodd-Frank was enacted in 2010 and may represent Congress's last shot at dialing back financial regulation before midterm elections in November.
House leaders agreed to vote on the compromise bill that Senate Republicans negotiated with moderate Democrats in exchange for a promise that a broader set of House-passed rollbacks will get a vote later this year. Senate Democrats who backed the plan sponsored by Banking Committee Chairman Mike Crapo, an Idaho Republican, have said they will oppose further changes.
'Propelling Growth'
"This is a moment years in the making," Crapo said in a statement after the bill's passing. "This step toward right-sizing regulation will allow local banks and credit unions to focus more on lending, in turn propelling economic growth and creating jobs."
Moderate Democrats' support for the bill has sparked fights with progressives including Senator Elizabeth Warren of Massachusetts, who say the bill is a gift to bank lobbyists.
"The bill would raise the asset threshold at which banks would be subject to enhanced supervision by regulators, weaken stress tests and capital requirements for big banks, undermine critical mortgage protections, and exempt 85 percent of depository institutions from reporting important Home Mortgage Disclosure Act data," Representative Maxine Waters of California, the top Democrat on the House Financial Services Committee, said in a statement before the vote. "I'm all for helping community banks and credit unions but this bill goes way beyond that and includes massive giveaways to Wall Street."
The legislation gives smaller banks relief from post-crisis rules that they've decried as burdensome and costly. It raises to $250 billion in assets from $50 billion the threshold for banks to face stricter Federal Reserve oversight as systemically important financial institutions. That would free companies such as American Express Co. and SunTrust Banks Inc. from higher compliance costs associated with being considered too big to fail.
