Breaking up the largest U.S. banks would push businesses such as Caterpillar Inc. (CAT) and Boeing Co. (BA) to use Chinese lenders instead, said Frank Keating, chief executive officer of the American Bankers Association.
“The only place in the United States right now that has a balance of payment surplus is financial services. So we’re going to break up the banks and turn over Caterpillar’s business and Boeing’s business to the Chinese,” Keating said today in a Bloomberg Television interview. “Are we going to do that really?”
Keating, whose organization is the largest trade group for U.S. banks, said he is worried about the 2010 Dodd-Frank Act’s effects on smaller commercial banks, which cannot handle the “mountain of regulation, this mountain of uncertainty, this mountain of potential tax and regulatory liability.”
Banking leaders and regulators cannot allow “misguided anger over what happened in the fall of ’08 to destroy what has been essential for the success of America,” he said about U.S. commercial banks. Banking and regulatory leaders must instead ensure that they “lubricate the financial service industry,” Keating said.
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