In the past month, parts of the Dodd-Frank Act have been updated through the Crapo Bill and the Volcker Rule rollback. Read on for more information on these important changes.

The Crapo Bill

Date: May 24, 2018

How: President Trump signed off on the Crapo bill, which passed the Senate and House of Representatives earlier this year.

Key changes to Dodd-Frank:

  • Banks with less than $250 billion in assets will no longer be required to undergo stress tests, whereas previously, the threshold was $50 billion.
  • A few large financial institutions, like American Express and BB&T, will no longer be deemed systemically important, allowing them to avoid stringent oversight from regulators.
  • Some loan originators, including small lenders, will be exempt from certain disclosures formerly required by the Home Mortgage Disclosure Act (HMDA).

Volcker 2.0 Update

Date: May 30, 2018

How: The Federal Reserve voted to approve Volcker 2.0, a broad proposal that eases financial crisis-era regulations on risky trading. Fed Chairman, Jerome Powell said, “Our goal is to replace overly complex and inefficient requirements with a more streamlined set of requirements.” The proposal still requires approval by four other banking regulators, but they are expected to follow the Fed’s lead.

Key changes to Dodd-Frank:

  • The level of regulator scrutiny would correspond to the amount of trading that goes on at a particular bank, which means lower compliance costs for banks with smaller trading operations.
  • Proprietary trading would still be banned under the proposed update.