This morning, Treasury Assistant Secretary for Financial Markets Mary Miller discussed continued progress on implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act at the Annual Washington Conference of the Institute of International Bankers (IIB). Read some excerpts:
“Much of the basic framework of these reforms is already coming into effect. The Federal Deposit Insurance Corporation has finalized rules for winding down large firms that fail through an orderly bankruptcy-like process that will help limit the fallout from their failure. Had this ‘resolution authority’ been in place in 2008, we would have had much more effective tools to mitigate the financial crisis.
“The Consumer Financial Protection Bureau is up and running and undertaking initiatives for better disclosure to consumers. Regulators are deploying new authority and greater enforcement resources on a more coordinated basis to go after fraud and unfair practices.
“The majority of the new initiatives for reducing risk and improving the transparency of the previously unregulated derivatives markets have been proposed and more rules are being finalized with each passing month. 2012 should bring much more clarity to firms adjusting for these changes.
“As a result of the reforms we have been putting into place, the financial system is getting stronger and safer. Financial institutions are better capitalized, less leveraged, and more liquid, which reduces systemic risks. Some of these changes have already been required, some anticipate Basel III, and some simply reflect caution after the financial crisis. But the gains we have made will erode over time if we are not able to complete the work that is underway.”
Assistant Secretary Miller also noted that “as we continue moving forward, [the public can] rest assured that we are not just trying to get reforms done so that we can check a box. We are focused on getting the reforms right so that they reduce risk, improve transparency and help restore market discipline in our system, while preserving the best features of our markets and the competitiveness of our financial institutions.”
This morning’s speech follows Secretary Geithner’s op-ed in the Wall Street Journal calling on all Americans not to allow collective amnesia about how close the country came to complete financial collapse to dismantle, delay, or defund reform efforts.
Erika Gudmundson is New Media Specialist at the Department of the Treasury.