FACT SHEET: President Biden Urges Regulators to Reverse Trump Administration Weakening of Common

Apr 22, 2023

President Biden believes that resilient community and regional banks provide vital services to small businesses, workers, and families around the country. The Biden-Harris Administration has taken decisive action to ensure the stability of the banking system without putting taxpayer dollars at risk. As we have demonstrated, the administration has the tools to act quickly to prevent contagion and is committed to taking strong action if needed. Americans should have confidence that their deposits will be there when they need them.As the President said when his administration announced actions to stabilize the banking system, he is committed to "continuing our efforts to strengthen oversight and regulation of larger banks so that we are not in this position again." The Obama-Biden Administration put in place strong requirements – primarily through the Dodd-Frank Act and subsequent regulations and supervision – to reduce the risk of future banking crises. Unfortunately, Trump Administration regulators weakened many important common-sense requirements and supervision for large regional banks like Silicon Valley Bank and Signature Bank, whose recent failure led to contagion.The President believes that the weakening of common-sense bank safeguards and supervision during the Trump Administration for large regional banks should be reversed in order to strengthen the banking system and protect American jobs and small businesses.Specifically, the President urges the federal banking agencies, in consultation with the Treasury Department, to consider a set of reforms that will reduce the risk of future banking crises, including:

Each of these items can be accomplished under existing law, and they build upon regulatory reforms already on this Administration's agenda, like completion of the executive compensation rule for bank executives authorized under Section 956 of the Dodd-Frank Act. It is important to put in place common-sense safeguards to reverse the Trump Administration's harmful weakening of bank safeguards and supervision and help ensure that community and regional banks remain resilient and continue supporting small businesses and jobs.

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