Big Banks Can Relax, Trump’s Modern Glass-Steagall Isn’t Aimed at Breaking Them Up
By Ryan Tracy
The Trump administration’s often-stated goal to review the line between commercial and investment banking activities may be very different—and less onerous for big banks—than the industry fears. Analysts say there is another path: The Trump administration could use existing regulatory authority to restrict interactions between subsidiaries of large financial firms, while at the same time cutting back regulations that apply to each type of business.“Mr. Trump can have his Glass-Steagall cake and still eat regulatory relief because the rules for banks could get a lot less binding even as [bank holding companies] are severed into component parts,” Karen Shaw Petrou, managing partner of Federal Financial Analytics Inc., said in an April note to clients.A key question, Ms. Petrou says: How will the separate businesses be regulated?