releases: http://royce.house.gov/news/documentsingle.aspx?DocumentID=398205
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| http://royce.house.gov/news/documentsingle.aspx?DocumentID=398205 | Royce Questions Chair White on Cumulative Impact of SEC Regulations | 2016-11-15 | 2016 | 2016-11 | Republican | House | CA | Edward Royce | R000487 | royce.house.gov | legacy | Today, U.S. Representative Ed Royce (R-Calif.) questioned U.S. Securities and Exchange Commission (SEC) Chair Mary Jo White about the cumulative impact of Commission regulations during a House Financial Services Committee hearing entitled “Examining the SEC’s Agenda, Operations, and FY 2018 Budget Request.”“The focus of the SEC originally was, and I think should continue to be, the strength and resilience of our markets. That is critical to economic growth, to the jobs that are created thereby. When it comes to capital markets lending, I've got a question about the last few years... because we've had a lot of major regulatory changes, such as risk retention, accounting changes, prudential changes with new capital and liquidity rules, new disclosure regimes, and automated trading platforms. And all of this is occurring at the same time," said Rep. Royce"European regulators have raised concerns about how these new regulations fit together. Specifically, on his way out the door, E.U. financial-services chief Jonathan Hill concluded that, "whereas after 2008 the greatest threat to financial stability had been the financial crisis, over time the greater threat had become the lack of growth itself. In other words, too little risk itself became a stability risk.' Then [Hill] went on to say that, 'the crisis may have made the scale and the pace of regulatory change inevitable. But the various layers of regulation could have been better aligned.'That was his reflection. I was going to ask you yours, whether you agree with that sentiment. If we stepped back and reflected on the cumulative impact of all these regulations and carefully understand what this means for growth and lending before we move forward with major changes, what would your observations be?" said Rep. Royce.“The capital markets are an innovation built on taking prudent risk with factors fully disclosed. That's obviously a very important driver of growth of the economy and everything else that is positive. One has to worry about, and we do, system risk that could destabilize the system and obviously cause tremendous harm to investors. I think in terms of the impact of the regulations mentioned a little earlier, our economists at the SEC are studying, and will be reporting to Congress next year, on the cumulative impact of regulations on capital formation as well as corporate bond liquidity. It's something we study all the time. When we do our rules, by the way, our economists do study the economic impacts and they do look at not just the particular four corners of one rule and what your're changing there. Look you've got these other nine rules out there, so when you add this one, what is going to be the cumulative effect on all sorts of economic impacts. There may be a benefit for investors, there might not be, but what are the costs of it?" answered Chair White.“I think [Hill] is just in retrospect looking at this at a time, as you know, when there is still more coming down the pipeline. We have discussions continuing on Basel 4. We have the proposals on the ‘Fundamental Review of the Trading Book’. I assume you share that overarching goal which I think [Hill] speaks to, that we need to balance the goals of market stability and safety and soundness with the needs of market liquidity, end-users, and overall economic growth,” concluded Rep. Royce.“That’s part of the cost-benefit analysis we do. You have to think more broadly as I said before when you do that, and that’s very much a part of it,” replied Chair White.Watch Rep. Royce's questioning of Chair White here or by clicking on the image below: | 1 | 2026-03-30T12:14:52Z | 2026-03-30T12:14:52Z |