00:00Later today, we're going to have a panel of community bankers to talk about capital and liquidity regulations.
00:06So I wondered if you might be willing to share your views and thoughts about how we could appropriately calibrate those capital and liquidity levels,
00:14especially for community banks, but maybe more broadly across the banking system to be more effective for economic growth and how to support the economy going forward.
00:24I think if we take a step back, we could see that the substantial amount of credit that is being grown outside of the regulated banking system
00:34tells you that the regulatory framework that was developed post Dodd-Frank is too tight
00:44and that there is a substantial arbitrage to be done, whether it's vis-a-vis big banks, whether it's small banks.
00:51Why do we have private credit that is bundling loans and then receiving lines of credit from banks?
01:03Let's get back to the primary lending function.
01:07Let's make capital more risk-based.
01:10Let's understand that there's a lot of work to do in terms of bringing this back down to common sense levels,
01:24in terms of knowing your client, in terms of releasing what I would say is this regulatory straitjacket.
01:35And famous last words, I think private credit is a dynamic new aspect that increases the depth and breadth of the U.S. financial system,
01:46but it can't be to the detriment of the regulated system.
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