JPMorgan Chase Chairman and CEO Jamie Dimon stated on Thursday (November 14th) that Wall Street is excited about President Trump’s prospects for reducing regulations and revitalizing the banking industry in his second term.
Speaking at the APEC CEO Summit in Lima, Peru, Dimon emphasized that regardless of who wins the election, many bankers are feeling optimistic about the future as they have been constrained by regulations for years, which have hindered lending.
Dimon, the CEO of the largest bank in the United States, highlighted the issue of loan-to-deposit imbalances. In the past, banks could lend out as much as they had in deposits, but now, for every $100 in deposits, they are only allowed to lend $65 due to government regulations.
“If this is what you want, if regulators for some reason think they are geniuses and this is the best way to manage the banking system, so be it,” Dimon said, adding that regulators may not have anticipated the impact of these regulations on lending operations.
Dimon also pointed out that every industry can benefit from reduced regulations, making it easier for businesses to operate.
He further stated that excessive government regulation on businesses in the United States is a mistake.
“I applaud any government that says ‘I want to make government more efficient,'” Dimon added.
His comments align with Trump’s recent announcement to appoint Tesla CEO Elon Musk and tech entrepreneur Vivek Ramaswamy to lead a new Government Efficiency Department, which will operate outside of the government.
Trump is expected to implement more relaxed regulations and pro-business policies, aiming to stimulate investment and other banking activities such as mergers and acquisitions. During his first term, Trump took actions to ease regulations on the banking industry.
In a research report last week, Wells Fargo analyst Mike Mayo expressed that Trump’s victory will change the “regulatory game rules” for the banking industry. He wrote that Trump’s new administration may signify “more free markets, less severe regulations,” and reduce regulatory risks.