SIFMA wants more coordination, analysis of Dodd-Frank regulations
Tim Ryan, chief executive of the Securities Industries and Financial Markets Association, believes the sheer size of Dodd-Frank remains a challenge for the financial services industry, as regulators attempt to establish one-third to one-half of the reforms within the next six months. "One of the biggest concerns is the Treasury runs the Financial Stability Oversight Council," Ryan told Bloomberg Television Monday. "Their job is to coordinate (the new regulations). We don't think they are doing their job. It's not coordinated." The former vice chairman of JPMorgan (JPM) said another major concern is the economic impact of the new rules. Ryan warned that as new regulations push capital requirements higher, banks will take action not in the economy's overall interest. "We believe the people who are developing the capital rules are not looking at all of the impacts of those actions," he said. "A predictable outcome is as they push capital up, the banks to meet the capital requirements will shrink the asset size, which pushes the businesses out into the shadows," he said. "So the next issue will be in the shadows and it will be with less highly regulated and less highly capitalized institutions." He said many banks expect a return on equity in the "mid-teens" as they implement the new capital requirements, but Ryan see a broader range of potential returns. Still, he wants more analysis of potential consequences from the sweeping reforms. "We're not opposed to Dodd-Frank, and just want to see it done responsibly ... reasonably, and if they need to take more time, quite frankly, we'd rather see them take more time to get it done porperly," Ryan said. Write to Kerri Panchuk.