Mike Segar | Reuters
Steven Mnuchin, U.S. President-elect Donald Trump’s reported choice for U.S. Treasury Secretary, speaks to members of the news media upon his arrival at Trump Tower in New York, U.S. November 30, 2016.
Repealing parts of Dodd-Frank that restrict regional banks from lending to small businesses will be an effective move for the new administration, Cowen and Co. CEO Jeff Solomon told CNBC on Wednesday.
Former Wall Street executive Steve Mnuchin confirmed to CNBC on Wednesday that he is Donald Trump’s pick for Treasury secretary, detailing in part his plan to roll back portions of the huge financial regulation bill that he said hurt small and medium-sized businesses.
“The rebirth of regional banking is actually quite strong, and to induce banks to be making loans to small and medium-sized businesses is actually a growth area,” Solomon told CNBC’s “Squawk on the Street.” “I think anytime you can get more liquidity into the marketplace for growing businesses, [it] helps economic growth.”
Solomon said that the changes Mnuchin proposed on Wednesday would not have “any impact at all on the major regulations” that apply to major banks, and would instead be “absolutely positive for regional banks.”
The CEO noted that a particularly strong point for Trump’s latest confirmed choices, Mnuchin for Treasury secretary and billionaire investor Wilbur Ross for Commerce secretary, is that they understand markets and financial recovery.
“Both of these gentlemen are extremely talented at turnarounds,” Solomon said, referring to the process of guiding a struggling company back to success.
Ross made his name in finance as a so-called vulture investor who specialized in rescuing poorly performing companies.
“We are about to enter a very interesting phase in the markets. We’re definitely going to see Fed raising rates, we have a lot of debt overhang, we’ve got to figure a way out of the zero interest rate policy that we’re in,” Solomon said.
“To me, these are two individuals who have a lot of savviness in how to manage that, and I’m happy to see them in the spots that they’re in,” the CEO said.