Market Overview

How Will The Election Impact The Banking Industry?

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How Will The Election Impact The Banking Industry?

It’s a precarious time for banks around the world.  

In the U.S., financial stocks have grossly underperformed the overall market, as the COVID-19 pandemic has created concerns about increased loan loss provisions and near-zero interest rates. Even community banks, which found some success with the Paycheck Protection Program, haven’t been able to outrun this sentiment.

In Mexico, regulators are temporarily rolling back bank regulations in an attempt to help the economy. Meanwhile, Europe’s largest banks sold off earlier in the week after document leaks showed years of suspicious activity. 

And on top of all that, there’s also the uncertainty of the upcoming election, which could itself have long-term implications for the industry. Muddying the picture is the idea from some experts that a Trump win and Biden win would each have positives and negatives for banks. 

“Neither outcome is a clear win or a clear loss for the banking industry or the market as a whole,” said Ed Mills, managing director, Washington policy with Raymond James. “You have to look at the more nuanced outcomes of the elections.”

Those nuances, he said, include how individual banks would react to fiscal stimulus versus changes to tax policy and regulations, how a change to the PPP program would help small businesses, and a potential re-escalation of trade tensions with China.

“With the reelection of President Trump, he will have the ability to keep his regulatory team in place and we probably see a cementing of the deregulatory push that has occurred over the last four years. If Joe Biden is elected, you will see changes at the OCC, the CFPB, likely at FHFA, and sooner rather than later atop the Federal Reserve and the FDIC, all of whom have a lot of power in determining the future of bank regulations, which can have a direct line to business activity and profitability.”

However, Mills added that each candidate comes with significant potential tradeoffs. 

“From a macro perspective, a Biden administration is far more likely to produce continued fiscal support for the economy. And so from an economic perspective, you can have a strong argument that continued fiscal stimulus under a Democratic sweep is more important to the financial services industry than potential changes to regulation and tax policy.”

Against this backdrop, 20 executives from 12 financial firms will offer insight into how they are navigating this terrain at the Financial Services Investor Conference on Thursday. The conference will open with a keynote presentation from Mills, who will offer more insight into what he is advising clients when it comes to how the election could impact the banking industry. 

Below is the schedule for the conference. Each presentation is followed by a virtual Q&A session with attendees and is available on demand.

To register for the free conference, click here.

Keynote Presentation: 2020 Election – Financial Services Outlook

Speaker: Ed Mills, Managing Director - Washington Policy with Raymond James Financial

10:00 AM ET Grupo Financiero Banorte, S.A.B. De C.V. (OTCQX: GBOOY) (BMV: GFNORTEO) (Latibex: XNOR)
Speaker: Tomás Lozano Derbez, Head of Investor Relations, Financial Intelligence and M&A.

10:30 AM ET SWK Holdings, Inc (NASDAQ: SWKH)
Speaker: Winston Black, Chairman & CEO

11:00 AM ET Bank of Idaho Holding Co. (OTCQX: BOID)
Speaker: Jeff Newgard, President & CEO

11:30 AM ET UC Asset LP (OTCQX: UCASU)
Speakers: Dr. Larry Wu, Founder; Greg Bankston, General Partner; Christal Jordan, Investor Relations Director

12:00 PM ET Victory Bancorp Inc. (OTCQX: VTYB)
Speakers: Joe Major, Bank Leader

12:30 PM ET First Home Bancorp, Inc. (OTCQX: FHBI)
Speakers: Anthony N. Leo, Chief Executive Officer; Robin L. Oliver, EVP, Chief Financial Officer; Jeffrey M. Hunt​, SVP, Chief Strategy Officer, 

1:00 PM ET Communities First Financial Corporation (OTCQX: CFST)
Speakers: Steve Miller, President & CEO; Steve Canfield, EVP & CFO

1:30 PM ET BIGG Digital Assets Inc. (OTCQB: BBKCF) (CSE: BIGG)
Speaker: Mark Binns, CEO

2:00 PM ET Alpine Banks of Colorado (OTCQX: ALPIB)
Speaker: Tom Kenning, Chief Administration Officer; Eric Gardey, Chief Financial Officer

2:30 PM ET United Bancorporation of Alabama, Inc. (OTCQX: UBAB)
Speaker: Robert R. Jones III, President & CEO

3:00 PM ET Community Bancorp of Santa Maria (OTCQX: CYSM)
Speaker: Janet Silveria, President & CEO

3:30 PM ET Isabella Bank Corp. (OTCQX: ISBA)
Speakers: Jae A. Evans, CEO, Jerome Schwind, President, Neil McDonnell, Chief Financial Officer

To attend the Financial Services Investor Conference, click here.

 

 

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