Treasury Issues Comprehensive Report on Depository System Regulatory Reforms: Trump Executive Order Required Fundamental Reassessment of Existing Rules; Treasury Submits the First of Four Reports Examining Existing Financial Regulatory Framework

Sullivan & Cromwell LLP - June 14, 2017

On June 12, 2017, the U.S. Department of the Treasury issued a report (the “Report”) recommending a number of comprehensive changes in the current regulatory system for United States depository institutions to create greater regulatory balance and economic opportunities. The Report is explicitly intended to “identify any laws, treaties, regulations, guidance, reporting and record keeping requirements and other government policies that inhibit Federal regulation of the U.S. financial system in a manner consistent with [a set of] Core Principles” that were enunciated in President Trump’s Executive Order 13772 (February 3, 2017).  The clear majority of the recommended changes in the Report could be accomplished by modifications of supervisory policy and regulations although certain fundamental changes would require legislation.

The Report is the first of four Treasury reports relating to a financial regulatory reform. The remaining three reports will cover: (i) capital markets (debt, equity, commodities and derivatives markets, central clearing and other operational functions); (ii) the asset management and insurance industries, and retail and institutional investment products and vehicles and (iii) non-bank financial institutions, financial technology, and financial innovation.