Treasury Targets Reducing Capital Market Regulations With Mnuchin Citing Growth Chances

2:24 PM, Oct 6, 2017 — The US Treasury outlined its proposals to streamline and reform the capital market regulatory framework, following on a key element of President Donald Trump’s election campaign last year.

Treasury’s evaluation of current capital market regulations found that there are significant reforms that can be undertaken to promote growth and vibrant financial markets while maintaining strong investor protections, according to a report released on Friday.

In February, Trump issued an executive that called on the Treasury to identify laws and regulations that are inconsistent with a set of designated core principles of financial regulation.

“We examined the capital markets system to identify regulations that are standing in the way of economic growth and capital formation,” said Treasury Secretary Steven Mnuchin in Friday’s release. “By streamlining the regulatory system, we can make the US capital markets a true source of economic growth which will harness American ingenuity and allow small businesses to grow.”

Last month, Federal Reserve members raised their outlook for growth this year to 2.4% from June’s projection of 2.2%. For 2018, the officials see 2.1% expansion.

The Treasury report said the US has seen a 50% reduction in the number of publicly traded companies over the past 20 years. The department is proposing streamlining disclosure requirements to reduce costs for companies and tailoring the disclosure and other requirements for companies going public based on their size.

They also found the federal financial regulatory framework could be improved by evaluating the regulatory overlaps and opportunities for harmonization of Securities and Exchange Commission and the Commodity Futures Trading Commission CFTC regulation.

Other recommendations include incorporating more robust economic analysis and public input into the rulemaking process to increase transparency and reviewing the roles, responsibilities and capabilities of self-regulatory organizations. Also, Treasury is looking to advance US interests and promoting a level playing field in the international financial regulatory structure.

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