Wall Street CEOs downplay risk of new bank breakup law
NEW YORK Top Wall Street bankers on Thursday said they are having positive discussions about financial regulation in Washington, and downplayed the idea that U.S. policymakers might force their institutions to split up.
On conference calls to discuss first-quarter earnings, executives from JPMorgan Chase & Co (JPM.N) and Citigroup Inc (C.N) said recent chatter about reinstating a Depression-era law to separate capital markets operations from traditional lending is nothing more than talk.
The White House confirmed last week that economic adviser and former Goldman Sachs Group Inc (GS.N) executive Gary Cohn backed the idea of bringing back the law, called Glass-Steagall. He is one of several prominent lawmakers, regulators or policy advisers who have expressed support for the idea, which Wall Street generally opposes.
Citigroup Chief Executive Michael Corbat said his conversations with Trump administration officials have not centered on the topic.
"I have yet to have anybody really explain to me what value there is in terms of either a reinstatement of Glass-Steagall, which is in itself strange, or what '21st century Glass-Steagall' is," he said. "We continue to ask about it but not necessarily be that focused on it."
He noted that a number of Wall Street executives have been "very engaged" with the Trump administration, as well as key members of congressional committees and regulators with regard to financial reform. He called the White House conversations "constructive."
JPMorgan executives struck a similar tone, saying a reinstatement of Glass-Steagall is inconsistent with other objectives of President Donald Trump.
"It is a pro-growth agenda, tax, infrastructure, regulatory reform," said CEO Jamie Dimon. "And that is a good thing."
(Reporting by Lauren Tara LaCapra; Editing by Chris Reese)