Big banks take gloves off to confront their D.C. overseers

Published On Aug 26, 2024, 5:04 AM

Big banks, especially JPMorgan Chase, are becoming more aggressive in their confrontations with regulatory bodies in Washington, D.C. This shift follows significant discussions around regulations impacting bank capital requirements and consumer protections. For instance, JPMorgan has hinted at potential legal action against the Consumer Financial Protection Bureau (CFPB) over investigations into Zelle, a payment app. Similarly, Goldman Sachs' CEO criticized a stress test conducted by the Federal Reserve, indicating discontent with regulatory scrutiny. Overall, these actions reflect a changing landscape where banks feel empowered to push back against regulatory constraints they find unfavorable.

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Stock Forecasts

JPMView JPM chart on TradingView

Positive

JPMorgan Chase and Goldman Sachs are showing signs of pushing back against regulatory scrutiny, which could lead to more favorable conditions for their operations, particularly in capital requirements and consumer finance areas. If regulators respond positively to bank concerns, it could bolster stock prices for these institutions.

GSView GS chart on TradingView

Positive

Goldman Sachs' recent criticisms of regulatory processes may indicate further tension between the bank and regulators, potentially leading to restrictions or unfavorable adjustments in operations. However, if they succeed in modifying regulations, it may lead to stock recovery in the longer term.

COFView COF chart on TradingView

Positive

Capital One's ongoing acquisition bid for Discover could face regulatory challenges, which might affect stock performance negatively if blocked. However, approval would position Capital One favorably in the credit card market and potentially drive its stock up.

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