The Impact of Dodd-Frank on Banks’ Noninterest Expenses
40 Pages Posted: 3 Sep 2016 Last revised: 15 Mar 2017
Date Written: March 14, 2017
This paper examines changes in commercial banks’ noninterest expenses following the Dodd-Frank Act of 2010. Using quarterly data on U.S. bank holding companies from 1995 through 2016, we separate noninterest expenses into salary and non-salary expenses and account for factors not related to regulatory compliance such as residential lending, deposits, write-downs of intangible assets, and general economic activity. We find that the growth rates of salaries have increased for both large and small banks. The levels of expenses for large banks do not increase after Dodd-Frank. For small banks, expenses of all types are significantly higher after the passage of the Dodd-Frank Act.
Keywords: Bank Expenses, Regulation, Federal Reserve, Dodd-Frank, Financial crisis
JEL Classification: E58, G21, G28
Suggested Citation: Suggested Citation