WaPo: White House Preparing To Call For New Rules On Midsize Banks

The Washington Post has reported that the White House is, “preparing to call for federal banking regulators to impose new rules on midsize banks” to prevent future bank emergencies similar to that of Silicon Valley Bank.

• According to WaPo sources, WH appears unlikely to call for reversal of the 2018 bipartisan deregulation law which some lawmakers have argued contributed to the collapse of SVB.
• WaPo: “The exact details of the White House’s recommendations are not clear, but they will try to reestablish rules for banks with between $100 billion and $250 billion that were deregulated by Congress and the Fed during the Trump administration…”
• Measures may include imposing higher capital requirements on banks, requiring banks to maintain greater cash reserves, requiring more frequent stress tests from federal regulators, and mandating plans for an “orderly dissolution in the event of a crisis.”
• Todd Phillips, a former attorney at the FDIC, said: “The White House can’t tell [Congress] what to do, but they can ask very nicely. Silicon Valley was not going to be stress-tested until 2024 under the Fed’s tailoring provisions — that’s just insane for a bank of its size.”