The Financial Choice Act was another anticipated regulatory change that didn’t transpire in 2017. Instead, various agencies addressed specific issues that will continue to be relevant to financial institutions: The CFTC is working to achieve clarity on international derivatives clearing, the CFPB is expected to bring welcome changes to rulemaking and enforcement after the contested appointment of a new director, the SEC chairman is seeking public comments on standards of conduct for investment advisers and broker-dealers, and New York state’s cybersecurity regulations impacting financial institutions (including foreign banks) took effect, with additional requirements coming into play in 2018.
The growth of technology in this sector presents additional challenges for financial institutions. Conflicting cultural dynamics often shape deal negotiations in fintech M&A, making legal, regulatory and compliance issues particularly critical. And while bitcoins garner the bulk of the public’s attention when it comes to virtual currency, the growing adoption of blockchain technology and the use of initial coin offerings to raise capital have brought additional legislative and regulatory scrutiny to this area.
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