So in its effort to cover every single risk in the complex world of banking, the regulation, too, had to become more complex – and that is still taking a very heavy toll on smaller institutions; too much so, if you ask me. For small institutions, especially, the work this entails is disproportionately time-consuming and costly.
At the same time, many a provision grasps at thin air at small institutions. Just take the existing disclosure requirements, which are there to ensure that large publicly traded institutions are subject to public accountability. Yet market discipline hardly has any bearing for small institutions which are not publicly traded – so why force them to satisfy the same provisions?