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National Banking Trends
Banking Panel Weighs Effects of Regulatory Changes
Interview with Lawrence Uhlick, BBVA Compass
Regulators and banking institutions alike are adjusting to a new regulatory climate and structure following passage of the Dodd-Frank Act. During the Atlanta Fed's 2012 Banking Industry conference, a panel of seasoned bankers highlighted some of the ways in which this landmark legislation is affecting international banks, thrifts, and investment banks.
The March 1 panel discussion featured commentary by Lawrence Uhlick, chairman of BBVA/Compass; Richard Ramsden, managing director of Goldman Sachs; and Steve Raney, president and CEO of Raymond James Bank.
Dodd-Frank could carry "unintended consequences"
He also honed in on the need for international financial institutions to coordinate among several different regulatory regimes. Indeed, the regulatory burden and compliance costs associated with the new rules were singled out as a primary risk facing the financial industry. However, smaller banks may have a harder time absorbing these costs than larger banks, which could fuel further consolidation within the industry, Raney noted.
Further, the broad issue of regulatory reform can be broken down into its effects on banks' consumer business lines and the capital market side of their businesses, Ramsden explained. While the bulk of the consumer banking rules have been written and implemented, there is still a significant level of uncertainty as to the effect the new rules will have on banks' capital market activities. Many of those rules have yet to be written and implemented, and as a result, banks are unsure how to restructure their businesses, he noted.
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