Continuing our post-election forecasts with a focus first on issues of potential bipartisan agreement, we turn here to the way in which the U.S. going forward will coordinate with global efforts such as those in Basel and the FSB, as well as the new structure likely for foreign banking organizations (FBOs). As Karen Petrou told Bloomberg, we think the U.S. will largely break from global forums to pursue its own agenda – implementing global-banking rules as U.S. regulators see fit (which will change dramatically as Trump appointees take charge over time) and then doing only what a revised Dodd-Frank allows once the new legislative framework takes shape. Action on FSB non-bank SIFI designations or activity-and-practice regulation through FSOC will terminate, and SEC asset-management initiatives (other than the MMF rule now in place) will either be rolled back or repealed early in the new year. Without insurance SIFIs, U.S. SIFI capital (see FSM Report SIFI20) and resolution rules are also off the table. CCP regulation is a critical question we will address in a forthcoming report.
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