The Dodd-Frank Act [1] is being voted on by the House this upcoming Wednesday according to House Majority Leader Kevin McCarthy [2]. In mid-April, Republicans proposed a reform to the financial system, The Financial Choice Act. The document explained how the Dodd-Frank Act embodied excessive regulatory complexity and ultimately harms economic growth. According to the proposal, Dodd-Frank’s particular brand of regulatory complexity and government micromanagement made basic financial services less accessible to small businesses and lower-income Americans.
The Dodd-Frank Act, originally composed after the 2008 housing market crash to reform Wall Street, is said to be too restrictive for banks. The proposed replacement, The CHOICE Act, offers financial institutions of all sizes a “Dodd-Frank” off-ramp, which, according to the proposal, is essentially freedom from an overly burdensome and highly intrusive regulatory regime in exchange for maintaining significantly higher capital than is required by current law and regulation.
Next Wednesday, the House will consider H.R. 10, the Financial CHOICE Act [3].
“This bill does a lot to grow the economy, but perhaps most importantly it revives the role community banks can play in getting small businesses and new ideas off the ground,” McCarthy said. “Since its inception, Dodd-Frank has strangled community banks with red tape and needless compliance costs. In fact, approximately 1,900 banks, many of which were community financial institutions, have disappeared since Dodd-Frank became law.”
McCarthy believes that regardless of what you need to borrow money for, access to capital should not rest in the hands of a few big banks.
“Chairman Jeb Hensarling (TX-05) and the Financial Services Committee have put forth a good bill that will revive our community banks by removing burdens that prevent lending, decreasing compliance costs, and improving their access to credit and capital,” McCarthy said. “Growing our economy starts with growing our communities, and for generations local banks have led the way in community investment.”
This Week’s Schedule:
FICO Consumer Banking Research [4], Tuesday, 8 a.m. PST.
MBA [5] Weekly Mortgage Application Report, Wednesday 7 a.m. EST
Consumer Credit Report, Wednesday, 3 p.m. EST
Freddie Mac [6] Weekly Mortgage Survey, Thursday, 10 a.m. EST
US Census Bureau [7] Quarterly Survey of Services (Q1) Thursday, 10 a.m. EST