WSJ-

Bank stocks have surged since the election on hopes that President-elect Donald Trump will roll back financial rules. But deregulation, for the biggest institutions at least, might come with a catch: tougher limits on borrowing.

Some influential voices in Mr. Trump’s world insist banks should, as a quid pro quo for rolling back some regulations, maintain higher capital—shareholders’ funds that act as a cushion against losses but can also curb profits.

“Between Trump’s populist victory and the calls for greater capital by…Republicans, it is far from given that the largest Wall Street banks would benefit from their reform efforts,” said Mark Calabria, a former adviser to Senate Banking Committee Chairman Richard Shelby (R. Ala.), and now a fellow at the free-market Cato Institute.

[WALL STREET JOURNAL]

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