Fed Economists Consider $10 Billion Threshold Imposed by Dodd-Frank
Economists at the Federal Reserve Bank of New York examined the "$10 billion threshold" imposed by Dodd-Frank Act regulation, and its "implications for size-based bank regulation" in which "compliance costs ratchet up with size." In their blog post on the New York Federal Reserve Board's Liberty Street Economics site, the economists stated: "[S]ystemic risk and the problem of too big-to-fail can increase with size (plus other factors), so [that] size itself – beyond a point – is problematic. Furthermore, size-based regulation might be a more efficient way to limit bank size and systemic risk than blunter alternatives."
The blog post was written by Research and Statistics Group Assistant Vice President Donald P. Morgan and Markets Group Senior Analyst Brian Yang.
Related Articles
-
On the anniversary of the passage of the Dodd Frank Act, Financial Services Committee Chair Jeb Hensarling argued that "[i]nstead of ending 'too big to fail,' Dodd-Frank has created 'too small to succeed.'"
-
U.S. Treasury Secretary Jack Lew acknowledged the six-year anniversary of the passage of the Dodd-Frank Act. "Without question . . . Wall Street Reform has made our financial system safer and sounder," he said.
-
American Action Forum ("AAF") Director of Regulatory Policy Sam Batkins and Research Analyst Dan Goldbeck detailed the costs to the economy of the Dodd-Frank Act.
-
Senator Sherrod Brown (D-OH) and Representative Maxine Waters (D-CA) asserted that the FSOC's rescission of the designation of General Electric Capital Corporation as a systemically important financial institution proves that "FSOC is working just as Wall Street Reform intended: to protect working Americans from once again bailing out 'too-big-to fail' institutions."
-
The Board of Governors of the Federal Reserve System determined that "the nation's largest bank holding companies continue to build their capital levels and improve their credit quality, strengthening their ability to lend to households and businesses during a severe recession."
-
House Financial Services Committee Chair Jeb Hensarling (R-TX) released an executive summary of the "Financial CHOICE Act," a Republican plan to replace the Dodd-Frank Act.
-
Participants at SIFMA-TCH 4th Annual Prudential Regulation Conference debated market developments since the enactment of the Dodd-Frank Act.
-
-
-
At the American Enterprise Institute, House Financial Services Committee Chair Jeb Hensarling (R-TX) asserted that the Dodd-Frank Act has rendered the United States a "less stable, less prosperous, and less free" country.
-
ISDA published "The Dodd-Frank Act: Five Years On," a brief analyzing the Act's impact on the derivatives markets over the past five years. ISDA noted progress and outstanding challenges.
-
A study conducted by Mercatus Scholars Patrick McLaughlin and Oliver Sherouse documented the overall size and breadth of the Dodd-Frank Act and determined that it "may be the biggest law ever."