The U.S. Treasury on Friday unveiled a blueprint for sweeping reforms of the U.S. capital markets as it looks to implement Republican President Donald Trump’s agenda to promote economic growth by slashing red tape.
The report recommends a raft of measures to encourage companies to seek public listings, to promote company access to capital, and to give investors a wider array of investment opportunities, in what is likely to be a boon for small business, banks, brokers and crowd-funding platforms.
It also called for regulators to put U.S. interests first when engaging in international regulatory forums.
“The U.S. has experienced slow economic growth for far too long,” said Treasury Secretary Steven T. Mnuchin. “By streamlining the regulatory system, we can make the U.S. capital markets a true source of economic growth which will harness American ingenuity and allow small businesses to grow.”
The 232-page report largely steers clear of proposing legislative changes that would have to be passed by a divided Congress, instead focusing on tweaks that could be made relatively quickly by the country's two markets regulators, which are both led by Trump appointees.
Christopher Giancarlo, chairman of the Commodity Futures Trading Commission (CFTC) and Jay Clayton, chairman of the Securities and Exchange Commission (SEC), said in statements on Friday they had provided extensive input to the "thoughtful" report and supported its recommendations.
Friday’s report is the second of four expected from the Treasury as it completes a comprehensive review of existing financial rules, as mandated by an executive order President Donald Trump signed in February.
The first report, released in June, sought to promote lending by easing banking regulations outlined under the 2010 Dodd-Frank Act, with major parts requiring legislative revisions that are unlikely to be passed with Democrats fiercely opposed.
Friday's report, in contrast, outlines a broad range of 91 technical fixes aimed at boosting stock, bond and derivatives markets. All but nine can be put into effect by the country's federal regulatory agencies, who were consulted on the report.
The recommendations were met with quick praise from financial industry groups, who said capital markets regulations were also long overdue for a review.