WASHINGTON (Reuters) – The U.S. House banking committee’s incoming chair said on Friday he would seek to remove “calcification” and reduce regulations in the sector when the next Congress convenes in January, showing an alignment with incoming President Donald Trump.
Republican Representative French Hill, in an interview with CNBC, also said the panel would work on creating a market structure for cryptocurrencies, but added that he was undecided on whether the U.S. should create a bitcoin reserve.
“Let’s make community banking and commercial banking competitive again by removing some of the calcification in the regulatory system that’s made it so hard to be profitable, serve customers and be safe and sound,” said Hill, a former banker selected on Thursday to lead the House Financial Services Committee.
“I don’t believe we have too many banks,” he added. “We would have a more competitive banking market if we didn’t have the regulatory structure that actually pushes consolidation in the banking industry to the largest bank because nobody can cope with the regulatory burden.”
The panel, which oversees and writes legislation for banks and the overall financial sector, would also remove impediments for companies “when it comes to capital formation and make it easier to go public and stay public in a more affordable way,” Hill said.
Trump, who takes office Jan. 20, has staked his second term in the White House on bolstering the U.S. economy and loosening regulations, which has been cheered by banking executives. On Thursday, the Wall Street Journal reported that Trump’s team is seeking to reduce, merge, or even eliminate the top bank regulators.
During his campaign, Trump lauded crypto, in which he has a personal financial interest, and has tapped some crypto-friendly players to top roles. Crypto companies want policies that would promote the widespread adoption of digital assets.
Hill said there needs to be more focus on the pathway for cryptocurrencies, and that financial tech companies should be able to partner with banks “in a safe and sound way.”
Asked about proposed legislation creating a U.S. bitcoin reserve, Hill told CNBC: “I’d have to think long and hard about what the value of that is to the United States or the Treasury, but I am certain of this: that we need a fair-minded, fit-for-purpose regulatory structure for digital assets in this country.”
