Cohn: Congress will 'hopefully' pass bank reg overhaul within months

Cohn: Congress will 'hopefully' pass bank reg overhaul within months
© Greg Nash

White House chief economic adviser Gary Cohn on Friday predicted that Congress could pass a bipartisan bill to exempt dozens of banks from post-crisis financial rules within the next three months.

Cohn said on Bloomberg News that the Senate bill to roll back the Dodd-Frank Act would "hopefully" see floor time in January and pass the House “in the first quarter of this year.”

“We are making enormous progress on a bipartisan basis on bank deregulation,” Cohn said. “We’ve got a bill in the Senate that has bipartisan support to really change the regulatory environment for the vast, vast majority of banks in the United States.”

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Last month, the Senate Banking Committee approved the bill offered by Chairman Mike CrapoMichael (Mike) Dean CrapoSenate Dems want watchdog to probe if SEC official tried to pressure bank on gun policies Community development impact remains clear with NMTC post-tax reform Overnight Finance: Trump signs Dodd-Frank rollback | Snubs key Dems at ceremony | Senate confirms banking regulator | Lawmakers lash out on Trump auto tariffs MORE (R-Idaho), by a 16-7 vote. Senate Majority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellSenate passes 6B defense bill Poll: Kim Jong Un has higher approval among Republicans than Pelosi The Hill's Morning Report — Sponsored by PhRMA — Outcry raises pressure on GOP for immigration fix MORE (R-Ky.) expressed interest last month in holding a vote on the bill in January, and nearly a dozen Democrats have sponsored the legislation.

Trump campaigned on a promise to "dismantle" Dodd-Frank, the strict 2010 rules on banks passed after the financial crisis, but has been unable to do so thus far. 

The bill would exempt small and mid-size banks from the most stringent parts of Dodd-Frank and scale back federal oversight of the financial system as a whole. But the bill contains no efforts to rein in the Consumer Financial Protection Bureau (CFPB), which would have poisoned the effort for Democrats.

The Crapo bill seems likely to pass the Senate without issue, but House conservatives have already expressed opposition to the compromise.

The Crapo bill is the most substantial attempt to roll back Dodd-Frank that has received bipartisan support. Bank lobbyists have rallied behind the bill as the last chance to make major changes to the post-crisis rules long targeted by the financial sector.

The bill’s lack of restraints on the CFPB has already cost it support in the House. Several GOP members of the House Financial Services Committee told The Hill that they couldn’t support a bill that doesn’t touch the bureau, long loathed by Republicans and the finance industry.

The House passed the CHIOCE Act, sponsored by Financial Services panel Chairman Jeb HensarlingThomas (Jeb) Jeb HensarlingOn The Money — Sponsored by Prudential — Trump nominates budget official Kraninger for consumer chief | Senate votes to block Trump ZTE deal | Stocks fall on trade tensions | House panel moves to markup budget Bank regulator: Review after Wells Fargo scandal failed to find industry-wide fraud Five ways Mulvaney is cracking down on his own agency MORE (R-Texas), in June. That bill, which would make deeper changes to Dodd-Frank and leave the CFPB nearly powerless, has been ignored in the Senate.