House hearing witnesses share opinions on Dodd-Frank’s impact

Thomas Deas

The House Subcommittee on Capital Markets and Government Sponsored Enterprises hosted several key players from the real estate and financial industry at a Tuesday hearing on Dodd-Frank.

Paul Vanderslice, the president of the Commercial Real Estate Finance Council, said that Dodd-Frank remains a threat to America’s economic recovery.

“The cumulative impact of the regulations implementing the Dodd-Frank Act poses a serious threat to sustaining the nation’s overall economic recovery,” Vanderslice said. “We are not suggesting that this consideration should impede issuance of final rules. Indeed, the tremendous uncertainty created by the multitude of required financial regulatory changes serves as a direct, independent impediment to private lending and investing, as the markets attempt to anticipate the impact these developments may have on the availability of commercial real estate credit, capital and liquidity.”

Thomas C. Deas, Jr., the vice president and treasurer of the FMC Corporation, warned that the impact of Dodd-Frank was not fully considered.

“While the drafters and implementers of the Dodd-Frank Act and other initiatives such as proposed money market fund regulations have focused on the financial services industry, the impacts are being felt by Main Street businesses as well,” Deas said. “Uncertainties about aspects of the law we thought were clear, like the derivatives end-user exemption from margining and central clearing, harm the ability of companies to manage and mitigate risk. The implementation of the Volcker Rule can imperil our ability to raise funds from the debt and equity markets. Also, potential money market regulations could harm our ability to manage business cash flow and fund short-term borrowings in the commercial paper market.”

Tuesday’s hearing, entitled “The Impact of Dodd-Frank on Customers, Credit and Job Creators,” is just one of several Dodd-Frank-related hearings scheduled throughout the month of July.

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