The Senate Banking Committee is expected to take up issues related to the Dodd-Frank Act, perhaps even making revisions and introducing new legislation in 2013, American Banker reported Nov. 25.
Paul Merski, executive vice president for Congressional relations and chief economist for the Independent Community Bankers of America, said that lawmakers are less concerned about the impact of their words and actions on voter behavior now that the election is over. “We're kind of getting in the phase where Congress will have a second review of how these provisions that regulations have fleshed out are impacting the marketplace, and maybe make corrections where things are not working out,” he told American Banker.
Sean Oblack, spokesman for the Senate Banking Committee, told American Banker that oversight of Dodd-Frank and mortgage finance reform would continue to top the committee’s agenda. However, some political observers and industry experts said that legislation, not just oversight, could happen in the coming year.
“There was a certain blood oath that Democrats took leading up to the election, where they all had to take a pledge to say that Dodd-Frank was the best thing going, but in truth they all knew that it needed drastic improvements,” Cornelius Hurley, director of the Boston University Center for Finance, Law & Policy, told American Banker. “Without the looming elections, they can now set about making those drastic improvements.”
Jaret Seiberg, senior policy analyst at Guggenheim Securities, noted that the committee’s focus “is going to be the shift from looking at why banks did bad things to how you can get more credit flowing into the economy,” American Banker reported.
Republicans may be willing to compromise and focus less on trying to repeal Dodd-Frank and more on trying to tweak it, American Banker noted. Among the areas where Dodd-Frank could come up for review are changes to the Volcker Rule, the structure of the Consumer Financial Protection Bureau and laws on “too big to fail” companies.
However, getting new bills to pass will remain a challenge. Observers aren’t sure yet how Sen. Michael Crapo, R-Idaho, who will occupy the lead Republican position on the Senate Banking Committee, will work with Chairman Tim Johnson, D-S.D., American Banker noted. Lawmakers also are expected to wait to see how both the CFPB’s new qualified mortgage rule plays out and how the interagency risk retention plan affects the market before submitting new bills.