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34 EU EXECS WARN AGAINST DODD- FRANK CHANGES e executive body of the European Union warned against any rollback of the Dodd- Frank Act, according to a report by Law360. European Commission spokesperson Vanessa Mock said they are studying the executive order issued by President Donald J. Trump at the start of February, which ordered the Secretary of the Treasury to review Dodd- Frank ahead of any attempts to modify the law. Mock said senior figures inside the Commission believe changes to the law could cause unrest or even destroy the international regulatory framework for bank standards, the nonbinding rules known as Basel III. "Our view is that international cooperation is vital in financial regulation," Mock said. "We want to see this continue, and this would be our message to the newly appointed U.S. administration." Valdis Dombrovskis, VP of the Commission and portfolio holder for financial stability, shared his dismay at possible rollbacks to Dodd-Frank on Twitter. "International regulatory cooperation was vital for effective response to the financial crisis and should continue," he tweeted. "No financial stability = no growth #EU #US." Trump cannot completely dismantle Dodd-Frank via executive order alone. In February, former U.S. Rep. Barney Frank (D-Massachusetts) said in an interview with DS News that Trump would have to pass any substantive Dodd-Frank reform through Congress—an unlikely prospect, he said. "Financial reform is very popular," Frank said. When the Republicans were in power under former President Barack Obama, they kept voting to repeal the healthcare bill entirely, but they never put the vote to the floor to repeal financial reform because the public supports financial reform. "He's not going to get this through the Congress, I believe," Frank said. House Financial Services Committee Chairman Jeb Hensarling (R-Texas) said Trump's order is like his bill, the Financial CHOICE Act, which he introduced last year as an alternative to Dodd-Frank. e bill included provisions to allow banks to escape capital, leverage, and liquidity requirements required by the Basel III international banking accords and instead to allow them to abide by a 10-percent leverage ratio. RBS SETTLEMENT DELAYED THANKS TO DOJ SHAKEUP e Royal Bank of Scotland (RBS) may have a brief reprieve from paying settlements between it and the U.S. government following the firing of the acting Attorney General Sally Yates. President Donald J. Trump replaced Yates on January 30 when she refused to defend his travel ban on citizens of seven Muslim-majority countries. Jeff Sessions was confirmed as the new Attorney General on February 8. As head of the U.S. Department of Justice, she oversaw any potential settlement with the U.K.-based bank in connection to its sale of toxic mortgage-backed securities (MBS) leading up to the 2008 financial crisis. RBS announced January 26 it plans to set aside an additional $3.8 billion in preparation to settle those claims, according to Business Insider, though following the firing of Yates any potential timeline could be delayed. No date had been announced for any settlement, though the bank made the provision public well ahead of its Full Year 2016 results announcement on February 24. e bank has not made any announced changes to those provisions following the abrupt change in leadership at the Department of Justice. e bank was one of 18 financial institutions sued by the Federal Housing Finance Agency in 2011 to recoup U.S. taxpayer costs following the government's $187.5 billion bailout of Fannie Mae and Freddie Mac in 2008. Most recently, RBS settled for $85 million in regards to charges by the Commodity Futures Trading Commission that its traders tried to manipulate a critical benchmark in the interest rate swaps market for more than five years. RBS has set aside a total of $8.3 billion in litigation "provisions" to date. "Putting our legacy litigation issues behind us, including those relating to RMBS, remains a key part of our strategy," said Ross McEwan, CEO of the U.K.-based bank. "It is our priority to seek the best outcome for our shareholders, customers, and employees." e provision will reduce RBS's Q 3 2016 CET 1 capital ratio to 13.6 percent. Business Insider reports that the new provision makes it unlikely RBS will post a profit for 2016, the ninth straight year the bank has failed to do so.

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