In this report, we build on our earlier alert regarding the President’s executive order (EO) bringing federal financial regulation and supervision directly under the Executive Branch. Although some commenters have suggested this will have little material impact given pending Trump nominees to key posts, we expect it will at the least slow and in many cases alter what would be largely technical decisions by moving them into the often-viral political environment in ways far beyond changes now effected through the Congressional Review Act. Further, areas where the banking industry seeks new rules – e.g., a rewrite of current capital standards taking the best of the 2023 proposal, cryptoasset certainty, debanking, NBFI constraints from the SEC/CFTC – could be complicated by White House or OMB demands based on little knowledge of financial markets and bank operations, along with political pressures rarely evident in the insular realm of banking-agency rulemakings….
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