Abby McCloskey, program director of Economic Policy at the American Enterprise Institute, believes what defines a bank as a systemically important financial institution should be reexamined.
McCloskey states that many of the banks that have been designated as systemically important under the 2010 Dodd-Frank Act do not pose a threat to economic stability nor did they have a hand in the current financial crisis.
"SIFI is not synonymous with Wall Street. While the six big-name Wall Street banks are included, the other twenty-seven SIFIs are Main Street banks, like M&T Bank out of Buffalo, KeyCorp out of Cleveland and Regions Financial out of Birmingham. These banks bear none of the traditional markings of being 'too big to fail,'" she adds.
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