With the presidential election less than a week away, analysts at Keefe, Bruyette & Woods believe that regardless of who wins there will be little or no changes to the Dodd-Frank Act.
Minor modifications could pass through Congress and some regulations may be tweaked, depending on who wins the election.
The researchers, however, believe investors will be more inclined to buy financial stocks if GOP contender Mitt Romney wins.
If the election outcome were based on swing states — Nevada, Virginia, Ohio, New Hampshire, Iowa, Colorado, Wisconsin and Florida — and their views on housing policy, President Obama would win the election with 274 electoral votes. Romney would fall short by only 10 electoral votes, reported RealtyTrac.
It’s expected that financial regulators will issue a flurry of regulations after the election, but these are various proposals that have been awaiting finalizations for awhile, including the CFPB qualified mortgage rule, the first batch of nonbank SIFI designations and the multiagency rule for the Volcker Rule.
If these regulations are finalized by the end of the year, the impact of the presidential election stops there in regard to the financial sector, KBW said.
With a Romney win, there is a better possibility that any changes in regulatory policy are likely to come from governmental agencies and not the legislative branch.
Polls have placed the candidates in a nearly dead heat in recent days.