The House of Representatives on Tuesday followed the Senate’s lead and passed a major banking deregulation bill, sending it to President Trump to be signed into law.
The bill will reduce oversight of about 30 large and mid-size banks by raising a key threshold used by regulators to determine which banks pose systemic risks to the financial system. The deregulated banks will face fewer stress tests and have more lenient capital and liquidity requirements.
The Dodd-Frank financial reform bill that was passed in response to the 2008 financial crisis set the threshold for “systemically important” banks at $50 billion in assets. This bill raises the threshold to $250 billion in assets. Several of the banks in this size range that will be deregulated received billions in government bailout assistance after the 2008 crisis.
Like in the Senate, Democrats were split on the bill while Republicans voted nearly unanimously in favor (I see you, Walter Jones). And just like in the Senate, the Democrats that sided with the Republicans tended to be those who have taken a lot of money from the banking industry.
According to my analysis of campaign contributions in the current election cycle, Democrats in the House that voted for the bill received, on average, a little more than $20,200 from the commercial banking industry. The Democrats that voted against it received just about $7,200 from the industry, on average.
Two House Democrats stand out for having taken especially large sums from the banks this cycle — Krysten Sinema ($115,472) and David Scott ($70,750) — and both voted for the bill.
Sinema has received donations from PACs of banks that will be deregulated under the bill and trade groups that lobby for them, including the Mortgage Bankers Association ($15,000), Synchrony Financial ($10,000), American Bankers Association ($10,000), and Consumer Banker Association ($7,500). David Scott has also received contributions from banks that will benefit, including Credit Suisse ($10,000), Regions Financial ($10,000), SunTrust Banks ($10,000), UBS ($7,500), Barclays ($5,500), and more.
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