American regulators start on a once-in-a-decade trek to reduce regulatory burdens for financial institutions. But don’t relax quite just yet.

The announcement wafted in by the usual channels sometime between Tuesday and Wednesday, but it didn’t get many people’s attention.

Still, it deserves some love in a world dominated by central bank rate-watching, geopolitics, market rallies and corrections, and the now all-important question of AI cropping up everywhere. The short of it is that US regulators have again embarked on an effort to identify «outdated and otherwise unnecessary» regulations for supervised financial institutions.

Two-year Effort

But don’t hold your breath. This is a once-a-decade thing that asks the key American supervisory agencies to seek comments from the public and they are going to take a good two years to get the comments in.

It is also something that begs the question. Did anything happen the last time this was done? To wit, there was a 440-page report resulting in 23 changes instituted between 2011 and 2016 (see Appendix 3 right at the end – and don’t try to scroll).

Few Do-Aways

But only two of the 23 were about doing away with anything entirely. The rest simply «enhanced», «referred», «expanded» and «extended» what was already there.

One of those that was cut out entirely also doesn’t seem to be all that much of a quick win. Unless I am wrong, since 2016 there has been nobody out there in international banking heaving a great sigh of relief that they no longer absolutely must give the authorities a plan about reaching full occupancy of any office premises they get their hands on.

Pinch of Salt

However, the principle is an important one. Going by anecdotal evidence from bankers, we are in the age of apparent peak compliance. Although we should take the latter with a big pinch of salt, the truth is that having an institutionalized framework that at least tries to get rid of anything like that regularly deserves applause – and an encore.

Moreover, a spot check of the questions shows they are well put and simple. One example: «Do any of these rules impose unnecessarily inflexible requirements? If so, please identify the regulations and indicate how they should be amended.»

Regular Agenda

In our trigger-happy age-making era, that should be a standard agenda point at regulatory committee meetings the world over, including key international banking supervisory bodies in Asia such as the Hong Kong Monetary Authority (HKMA) and the Monetary Authority of Singapore (MAS).