Trump signs Dodd-Frank rollback

President TrumpDonald TrumpRealClearPolitics reporter says Freedom Caucus shows how much GOP changed under Trump Jake Ellzey defeats Trump-backed candidate in Texas House runoff DOJ declines to back Mo Brooks's defense against Swalwell's Capitol riot lawsuit MORE on Thursday signed a bipartisan bill to loosen key portions of the Dodd-Frank Act of 2010, cementing the first major changes to President Obama’s landmark banking law.

Trump enacted the legislation during a White House ceremony two days after the House of Representatives passed the bill to exempt dozens of banks from strict federal regulation.

Trump had pledged to “dismantle” Dodd-Frank, a law long targeted by Republicans, and touted the bill he signed as the first step in that process. While the bill will release dozens of banks from stronger Federal Reserve oversight, it falls well short of the president’s vow to repeal and replace Dodd-Frank.

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“We’ve kept a lot of promises,” Trump said. “This is truly a great day for Americans, and a great day for workers and small businesses across the nation.”

The bill signed by Trump was the product of years of bipartisan negotiations between Republican senators opposed to the entire law and moderate Democrats concerned about its impact on community banks and credit unions. The narrow GOP majority in the Senate made it impossible to pass a Dodd-Frank rollback without the support of moderate Democrats.

The legislation was introduced in November by Senate Banking Committee Chairman Mike CrapoMichael (Mike) Dean CrapoHow Sen. Graham can help fix the labor shortage with commonsense immigration reform Lobbying world On The Money: Biden fires head of Social Security Administration | IRS scandals haunt Biden push for more funding MORE (R-Idaho) and a group of moderate Democrats on the panel, including Sens. Heidi HeitkampMary (Heidi) Kathryn HeitkampJoe Manchin's secret Supreme Court battle could wreak havoc with Biden's 2020 agenda Effective and profitable climate solutions are within the nation's farms and forests MORE (N.D.), Jon TesterJonathan (Jon) TesterNative Americans are targets of voter suppression too The Hill's Morning Report - Presented by Facebook - Crunch time for bipartisan plan; first Jan. 6 hearing today Senators scramble to save infrastructure deal MORE (Mont.), Joe DonnellyJoseph (Joe) Simon DonnellySupreme Court battle could wreak havoc with Biden's 2020 agenda Republicans fret over divisive candidates Everybody wants Joe Manchin MORE (Ind.) and Mark WarnerMark Robert WarnerOn The Money: Senate infrastructure talks on shaky grounds | Trump tells Republicans to walk away | GOP sees debt ceiling as its leverage against Biden Senate infrastructure talks on shaky grounds The Hill's Morning Report - Presented by Facebook - Jan. 6 probe, infrastructure to dominate week MORE (Va.).

Trump on Thursday praised “a lot of great Democrats” who had written the bill, but did not invite most of its Democratic authors to the signing ceremony.

Trump only invited Heitkamp to the event, snubbing Tester, Donnelly and Warner.

A Donnelly aide said his office "was told by the White House he would not be receiving an invitation due to space constraints.” Even so, the event was attended by close to two dozen lawmakers and administration officials, some of which had little to do with the legislation signed by Trump

Trump was also joined by Vice President Mike PenceMichael (Mike) Richard PenceRealClearPolitics reporter says Freedom Caucus shows how much GOP changed under Trump Want to improve vaccine rates? Ask for this endorsement Live coverage: House panel holds first hearing on Jan. 6 probe MORE, Crapo, House Financial Services Committee Chairman Jeb HensarlingThomas (Jeb) Jeb HensarlingLawmakers battle over future of Ex-Im Bank House passes Ex-Im Bank reboot bill opposed by White House, McConnell Has Congress lost the ability or the will to pass a unanimous bipartisan small business bill? MORE (R-Texas) and Treasury Secretary Steven MnuchinSteven MnuchinThe Hill's Morning Report - Presented by Goldman Sachs - Biden rallies Senate Dems behind mammoth spending plan Mnuchin dodges CNBC questions on whether Trump lying over election Democrats justified in filibustering GOP, says Schumer MORE.

The president was also flanked by several Republican members of the Senate Banking and House Financial Services panels, along with GOP lawmakers that had little input on the bill Trump signed.

Sen. Steve DainesSteven (Steve) David DainesSenate committee advances bipartisan energy infrastructure bill  Hillicon Valley: Lina Khan faces major FTC test | Amazon calls for her recusal | Warren taps commodities watchdog to probe Google Senators propose bill to help private sector defend against hackers MORE (R-Mont.) was in attendance for the ceremony, despite not being on the Banking committee or a co-sponsor of the legislation. Tester aides saw Daines' invitation as a move motivated by politics, snubbing the Democrat who had spent years crafting the bill.

A spokeswoman for Daines said "Since he was elected into the House, Daines has been consistently working on the repeal of the disastrous Dodd-Frank legislation," and pointed to his votes and speeches in support of the bill Trump signed Thursday.

The final compromise leaves most of Dodd-Frank in place, but provides a major boost for some of the largest U.S. banks. The measure releases of regional banks from tighter regulation by raising the threshold for closer Fed oversight from $50 billion to $250 billion in assets.

Banks below the new threshold will no longer be automatically subject to annual Fed stress tests and capital buffers meant to protect large firms are from severe financial crises.

Those banks are also no longer required to from submit for Fed approval a “living will” that outlines how a bank’s assets could be liquidated upon the firm’s failure without causing a widespread meltdown.

The bill includes several provisions to scrap rules for community banks and credit unions. Firms that hold 500 or fewer mortgages a year will no longer have to report some home loan data to federal regulators under anti-discrimination laws.

The bill also broadens the definition of qualified mortgages for smaller firms and exempts banks and credit unions with less than $10 billion in assets from the Volcker Rule, which bans firms from making risky bets with their own assets.

Trump said the rollbacks would help community banks and credit unions become “vibrant and strong,” insisting years of overregulation had suffocated small firms.

“They shouldn’t be regulated the same way as big complex financial institutions,” Trump said. “This is all about the Dodd-Frank disaster.”
Bank and credit union lobbying groups praised Trump for enacting the regulatory relief they’ve sought for years.

Rebeca Romero Rainey, president and CEO of the Independent Community Bankers of America, said the law “unravels many of the suffocating regulatory burdens our nation’s community banks face and puts community banks in a much better position to unleash their full economic potential.”

Updated at 1:37 p.m.