When the Trump administration announced its intention to roll back banking regulations, which they believe slows economic growth, the reaction was delight and disappointment. How will shareholders fare? Not very well, says one economics and financial expert.
When investors Sonterra Capital Master Fund, Hayman Capital Management LP and the California State Teachers’ Retirement System believed that a number of banks and brokerage firms had manipulated the yen-Libor rate, they sued in a New York federal court in 2015. Last week, Deutsche Bank AG and JPMorgan Chase & Co. have agreed to pay a hefty $148 million to settle investors’ claims.
The recent confirmation hearing for Treasury Secretary nominee Steven Mnuchin as well as his written answers to questions after the hearing revealed much about his views and intentions for the banking industry if confirmed.
This Thanksgiving, the chance of President-elect Trump’s victory dividing some tables is high. By contrast, banks large and small are now fairly united in their optimism for the new administration.The New York Times recently reported that while small banks only first cheered Trump’s win, big banks have followed. Both are benefiting from expectations that regulations will be rolled back on aspects ranging from banks fees to lending rules. They’re also looking forward to potentially higher interest rates under the proposed stimulus package. But, as the Times points out, the President-elect’s position on the banking industry has been conflicting at times and details of his plans aren’t yet crystal clear.