Elizabeth Warren and Katie Porter are reportedly taking the first step in repealing the Trump-era banking law they blamed for Silicon Valley Bank's collapse
, which was passed in the aftermath of the 2008 financial crisis to protect consumers from abusive banking behavior.in passing a bill that took away oversight measures for midsize banks like SVB by raising the threshold for regulation standards — essentially assessing how a bank would respond to financial shocks, like an increase in interest rates — from $50 billion to $250 billion.
"In 2018, I rang the alarm bell about what would happen if Congress rolled back critical Dodd-Frank protections: banks would load up on risk to boost their profits and collapse, threatening our entire economy — and that is precisely what happened," Warren said in a statement."President Biden called on Congress to strengthen the rules for banks, and I'm proposing legislation to do just that by repealing the core of Trump's bank law.
The Democrats' legislation would restore the 2010 threshold for bank regulation, according to the press release. Sen. Bernie Sanders also said on Monday that SVB's failure was a"direct result" of the 2018 legislation. Some of the Democratic lawmakers who voted for the 2018, like Virginia Sen. Mark Warner, said they still stand by their vote. Sen. Joe Manchin told CNN on Tuesday, that although he voted for the bill,and would support more regulations as long as it did not lead to overregulation.
"Americans deserve to know their money is safe when they deposit it in the bank," Porter said in a statement."In 2018, politicians rolled back critical regulations protecting Americans' deposits—ignoring warnings from financial experts in favor of Wall Street special interests. I'm calling on Congress to restore common-sense guardrails that keep corporate greed in check and restore confidence in our financial system.
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