What the Dodd-Frank rollback means for you

Impacts, implications and responses for banks

Download RFP
Mans hand pointing pen graphchart using On May 24, 2018, President Trump signed legislation rolling back key provisions of the 2010 Wall Street Reform and Consumer Protection Act (Dodd-Frank). What changes? And how should banks react?

The rollback increased the threshold for a systemically important financial institution (SIFI) from banks with $50 billion in assets to banks with $250 billion in assets. This will free most credit unions and community and regional banks from Dodd-Frank rules concerning:

  • enhanced stress testing
  • liquidation planning
  • risk-based and leverage capital requirements
  • liquidity thresholds
  • credit concentration limits
  • risk governance standards
  • public disclosures

Banks with from $100 billion to $250 billion will now be subject to bespoke oversight.

The rollback will free up money and resources currently devoted to regulatory compliance, allowing affected banks to:

  • Use capital previously maintained for reserves to new opportunities
  • Improve return on assets and return on equity
  • Re-direct resources to addressing cyber threats and new opportunities
  • Consider mergers or acquisitions that previously would have pushed them over the SIFI threshold
  • Modify risk policies and procedures, which may increase the importance of internal governance

We suggest that banks capitalize on this opportunity with a Dodd-Frank rollback plan that:

  • Maintains key infrastructure to improve data gathering capabilities
  • Drives development of a risk management approach that moves beyond a compliance focus
  • Considers RegTech opportunities
  • Heightens attention to cyber risk
  • Uses a performance-driven risk management approach to adjust business models
  • Re-evaluates growth strategies

Rolling back Dodd-Frank: Impacts, implications and responses for banks, offers more detail on the Dodd-Frank rollback and how your bank can build on this opportunity. Download the whitepaper today.

Contacts Tariq Mirza Tariq Mirza
Principal, Risk Advisory Services
T: +1 703 637 2820

Mark DeLong Mark DeLong
Consultant, Risk Advisory Services
T: +1 212 542 9504

Alfred Spahitz Alfred Spahitz
Managing Director, Risk Advisory Services
T: +1 704 632 3940