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Business Executives to Congress: Too Big to Fail Legislation Harms TTIP Deal
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- Created on Thursday, 06 June 2013 12:27
On Monday the Business Roundtable, an association of chief executive officers of leading U.S. companies, wrote to members of Congress calling for financial services to be included in the Transatlantic Trade and Investment Partnership (TTIP) agreement between the United States and the European Union. The business executives also warned Congress that the legislation proposed by Senators David Vitter (R-LA) and Sherrod Brown (D-OH) to increase capital requirements for large banks, along with other similar proposals, could significantly damage the global competitiveness and economy of the United States, and the TTIP talks at large.
Voices in the debate over higher levels of capital
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- Created on Friday, 24 May 2013 09:59
There has been much discussion in Washington recently regarding the appropriate amount of capital large banks should hold. As we’ve previously stated, the financial sector has undergone several significant changes since the 2009 that have strengthened banks’ safety and soundness. Capital is included in those improvements and is – in fact – now at double pre-crisis levels. As lawmakers discuss higher levels of capital for financial institutions, it is important to be mindful that unnecessarily high levels can become problematic and even counterproductive to a well-functioning economy. Too much capital can impede banks' ability to perform their important role in the economy by limiting their ability to lend to businesses small and large.
Treasury’s Mary Miller: Dodd-Frank Ends TBTF
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- Created on Monday, 22 April 2013 14:01
Last week, Mary Miller, the Treasury Department’s Undersecretary for Domestic Finance, delivered a speech that addressed the often misconceived view of “too big to fail” financial institutions. In her speech, Ms. Miller stated that with the enactment of the Dodd-Frank Act, regulators now have the necessary tools to wind down a failing institution in an orderly way, specifically through orderly liquidation authority and banks’ living wills. Ms. Miller also discussed her views on how Dodd-Frank ensures that taxpayer dollars will never be on the hook again, which is a shared goal of the financial services industry.
ICYMI: Cato Institute’s Bennetts: ‘Too Big to Fail’ is a Distraction
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- Created on Thursday, 07 March 2013 13:43
Recent bipartisan calls to break up the largest banks in the United States are just a distraction from the real causes of systemic risk, writes Louise Bennetts in an American Banker op-ed today. In her opinion piece, Bennetts addresses and corrects five assumptions associated with the “too big to fail’ (TBTF) argument, including the true cause of the financial crisis, how the U.S. banking system is both smaller and less concentrated than other countries, and the lack of credibility surrounding the claim of whether or not TBTF firms have a funding advantage over non-TBTF firms.
Bennetts also addresses perhaps one of the most important and often overlooked aspects of the Dodd-Frank Act, which addresses the TBTF issue by giving regulators the legal authority and procedural framework to wind down a failing institution of any size, more commonly known as Orderly Liquidation Authority. Thanks to this new authority, large institutions are no longer immune from failure, and U.S. taxpayers will no longer be on the hook for banks’ mistakes.
Fed Governor Powell discusses how Dodd-Frank ends ‘too big to fail’
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- Created on Monday, 04 March 2013 17:18
In a speech today in Washington, Federal Reserve Board Governor Jerome Powell discussed how regulators are moving forward to implement portions of the Dodd-Frank Act that were designed to eliminate the notion of “too big to fail.” He shared a pragmatic perspective about the effectiveness of the Orderly Liquidation Authority and other legal capabilities, such as living wills, included in Dodd-Frank to ensure that taxpayers will never again be asked to bailout a failing institution. During his speech, Powell said, “the current reforms are promising and should be given time to work,” which they most certainly should.
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The Financial Services Forum is a non-partisan financial and economic policy organization comprising the CEOs of 19 of the largest and most diversified financial services institutions doing business in the United States.
The purpose of the Forum is to pursue policies that encourage savings and investment, promote an open and competitive global marketplace, and ensure the opportunity of people everywhere to participate fully and productively in the 21st-century global economy.
Welcome to ForumBlog. This is where our policy team analyzes the latest proposals, ideas, and news surrounding financial sector regulatory reform, trade, and the economy. Our goal is to provide thoughtful insights on the issues impacting the intersection of Wall Street and Washington, as we pursue policies that encourage savings and investment, promote an open and competitive global marketplace, and ensure the opportunity of people everywhere to participate fully and productively in the 21st-century global economy.
