Brown, Vitter to Speak at ‘Too Big to Fail’ Forum
By Rob Blackwell
The battle over “too big to fail” has continued to show surprising momentum nearly three years after the passage of the Dodd-Frank Act, a bill that was supposed to put an end to the debate. Yet this year the debate has erupted anew, with one bill already introduced in the Senate to break up the banks and another expected shortly to raise their capital standards from the unlikely bipartisan team of Sen. Sherrod Brown, D-Ohio, and Sen. David Vitter, R-La. Fueled by comments from Attorney General Eric Holder and a series of mistakes from the largest banks, a growing coalition of voices are advocating a breakup of the biggest institutions. Yet as Barbara Rehm, American Banker‘s editor-at-large, has pointed out, there are significant questions remaining about how this could be done and what its impact would be. It also remains unclear whether the momentum is sufficient to pass legislation. “There are always a lot of issues on the Washington launch pad, the question is what ignites the engine,” said Karen Shaw Petrou, the managing director of Federal Financial Analytics. “I think ‘too big to fail’ is on the pad and it’s fueled – what I don’t know is whether there is a spark.”