Let’s take a step back to analyze the current Administration’s deregulation efforts; there’s a lot to unpack. In the midst of these efforts, what will the result be for community banks?
Will community banks be able to weather the “storm?” Will the so-called storm even blow more wind into community bank sails? (And sales for that matter)
As recorded in a piece by Investco: “… a study on regulation and investment found that the stricter regulation of markets in Europe relative to the US in the 1990s, during a period of rapid technological innovation, resulted in faster growth in the US than Europe.”
In other words, the folks who performed the study discovered what the history books have already told us: limited regulation leads to superior results. “Superior results” meaning, more business growth, which leads to more wealth, leading to more spending, investing and so forth.
Deregulation: Boom or Bust for Community Banks?
From the 10,000 foot view, the aggressive deregulation efforts by the Department Of Government Efficiency (DOGE) and the Trump Administration appear to be good for banking and bankers in general. But why community banks in particular?
Community banks are known for being personable a place where “they know you by name, and treat you like family.” In these times that are very optimistic for investments and loans, customers are still wary of the volatility of the market considering the onset of huge tariffs.
In a word, the market seems to be on the verge of something great, but greatness comes with risk. What better way to de-risk than by working with people you trust?
Read More: Trump, Tariffs, and The Effects On Community Banking
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