Republican Sen. Steve Daines of Montana garnered applause from a room full of bankers on Tuesday after he dismissed calls for tougher regulations following the collapse of Silicon Valley Bank and Signature Bank.
"There are a lot of talking heads out there who are saying that the solution is more regulation, and I strongly disagree," Daines said in remarks to the American Bankers Association's Washington Summit, an annual gathering of bank CEOs and other top executives.
The Montana Republican went on to defend a 2018 law that progressive lawmakers and experts have said is at least partly responsible for the recent bank failures. That measure, known as S.2155, weakened post-financial crisis regulations for banks with between $50 billion and $250 billion in assets, subjecting firms such as SVB—which lobbied for the changes—to less stringent oversight and paving the way for more risk-taking and industry consolidation.
Daines, a member of the Senate Banking Committee and a major recipient of securities industry donations, called the stricter liquidity requirements and other rules gutted by the 2018 law "overreaching regulations" and claimed that efforts to revive the safeguards are creating "more worry" in the banking sector.
"This was not the cause of this failure," Daines said of S.2155, which former President Donald Trump signed into law after it passed with bipartisan support.
Watch the senator's remarks, which begin at the 1:32:04 mark:
It's unsurprising that Daines' defense of S.2155 was received favorably by a gathering of the American Bankers Association, which was one of many industry groups that lobbied aggressively for the measure.
"The lobbyists were everywhere. You couldn't throw an elbow without running into one," Sen. Elizabeth Warren, D-Mass., who vocally opposed S.2155, told reporters last week.
Warren and Rep. Katie Porter, D-Calif., have introduced legislation that would repeal a critical section of the 2018 law.
The Associated Press reported Tuesday that in the hours before Congress approved the measure, Sen. Jon Tester, D-Mont.—one of the legislation's top Democratic supporters—"huddled with executives from Bank of America, Citigroup, Discover, and Wells Fargo, who were there on behalf of the American Bankers Association."
"The American Bankers Association, which helped lead the push, later paid $125,000 for an ad campaign thanking Tester for his role in the bill's passage," the Associated Press noted.
The banking group's PAC spent more than $2.6 million on campaign contributions during the 2018 election cycle, with more than 76% of the donations going to Republicans, according to OpenSecrets.
Daines, who won reelection in 2020, received $10,000 from the American Bankers Association PAC during that year's campaign.
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