Banks ‘flying blind’ without cumulative data on regulatory proposals

By   Kyle Campbell

Regulatory changes, both adopted and proposed, have been in ample supply in Washington as of late, but banks and analysts alike say it’s hard to know just how those changes will fit together, in part because government forecasts have been scarce….Despite the overlapping nature of these proposals, there has been no effort to reconcile their combined impact on the banking sector or the broader economy, Karen Petrou, managing partner of Federal Financial Analytics said. “There is no cumulative impact statement from the agencies, and that’s just a profound failure of analytical rigor,” Petrou said. “The agencies not only seem unable to do cumulative impact analysis, but weirdly unwilling to despite the suggestions that they’re working on something ‘holistic.’ It’s puzzling.”Without a comprehensive overview of how these potential rule changes would interact with one another, banks and their representatives say regulators are running the risk of accidentally inducing bad outcomes.