House Committee Examines 15 Years of Dodd-Frank
July 22, 2025
The House Financial Services Committee held a hearing on July 15 titled “Dodd-Frank Turns 15: Lessons Learned and the Road Ahead.”
- Ken Bentsen – Securities Industry and Financial Markets Association (SIFMA)
- Lindsey Johnson – Consumer Bankers Association
- Tom Quaadman – Investment Company Institute
- Dr. Paul Kupiec – American Enterprise Institute
- Dennis Kelleher – Better Markets
The congressional discussion centered on critiques and defenses of the Dodd-Frank Act’s regulatory framework, highlighting partisan divides. Republicans emphasized regulatory overreach and economic stagnation, and Democrats defended the law’s intent and attributed failures to subsequent rollbacks.
- Republican committee members argued that post-Dodd-Frank regulations are overly complex, costly, and ineffective. They cited the March 2023 banking crisis as evidence of failure, stating that regulation inadequately addressed risks like interest-rate exposure and misleading capital metrics.
- Dodd-Frank critics also contended that mid-sized and community banks face disproportionate harm from uniform rules, as compliance costs strain smaller institutions.
- Democrats highlighted Dodd-Frank’s successes, such as swap market reforms and improved capital resilience. Better Markets’ Kelleher blamed the 2018 Regulatory Relief Act, which exempted banks under $250 billion from the prudential rule, for creating vulnerabilities, arguing industry lobbying and litigation undermined Dodd-Frank’s implementation.
- There was bipartisan interest in shifting the Financial Stability Oversight Council (FSOC) back to an activity-based oversight approach and curbing its authority to designate non-bank entities as systemically important. Witnesses called for improved coordination and clearer regulatory boundaries to prevent duplicative oversight and regulatory overreach.
Specific issues discussed during the hearing included, among others, the Securities and Exchange Commission’s (SEC’s) authority, housing reform, and bank capital standards:
- Rep. Ann Wagner (R-MO) asserted that the SEC under former Chairman Gary Gensler had overstepped its statutory boundaries, citing the Fifth Circuit's unanimous June 2024 decision to vacate the SEC's private fund adviser rule.
- Committee members and witnesses discussed whether Dodd-Frank requirements represented an overcorrection in housing finance regulation and had forced smaller banks to exit the mortgage market.
- Bank capital requirements were blamed for restricting capital formation and burdening small banks with excessive compliance costs. SIFMA’s Ken Bentsen encouraged regulators to evaluate how various capital and liquidity rules function cumulatively and noted that the July 22 Federal Reserve bank capital conference would be a good starting point for this analysis.
While this hearing made headlines, other policymakers weighed in on related regulatory initiatives.
In a speech at the Exchequer Club in Washington, D.C., Senator Elizabeth Warren warned that she sees similarities between today’s market conditions and those leading up to the Great Financial Crisis:
- According to Politico, Warren called the GOP’s financial deregulation agenda “one more economic blow coming our way.” She also said that the Trump administration has turned banking watchdogs into “toothless lapdogs.”
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