US to ease crisis-era Dodd-Frank banking rules

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A tour bus passes the Wall Street bull in the financial district in New York City.

A move to relax US banking rules approved after the financial crisis has cleared its final stage in Congress.

The House of Representatives voted 258-159 to approve the measure, sending it to the president to sign into law.

The bill, which won some bipartisan support, reduces the oversight requirements for banks with less than $250bn in assets, among other measures.

The legislation is a victory for the Republican Party, though it does not go as far as some had hoped.

Supporters of the new legislation, which passed the Senate in March, say the reform will help small to mid-sized banks, without gutting crisis-era protections.

Support came primarily from Republicans, but 33 Democrats also voted for the measure.

Republicans, including President Donald Trump, have repeatedly pledged to repeal 2010 financial regulations known as Dodd-Frank.

They argued that the law was overly complex, putting smaller banks at a disadvantage and inhibiting economic growth and lending.

Dodd-Frank required large financial institutions to hold more money to use in the event of a financial shock, increased protections for consumers, and improved stress tests.

It made banks with more than $50bn in assets automatically subject to strict levels of oversight.

Critics of the changes said the higher threshold sets the US down a “dangerous road”.

The legislation leaves only about a dozen financial institutions automatically subject to the strictest rules.

Republicans celebrated the reform as significant, while adding that they are working on other deregulatory proposals.

Separately, the FDIC reported that profits at the country’s roughly 5,600 federally insured financial institutions totalled a record $56bn in the first three months of the year.

That was a more than 27% rise from the same period in 2017

[World News]

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