Senate Banking Committee Chairman Christopher Dodd unveiled a new blueprint for sweeping financial reform in an attempt to win bipartisan support. What does this mean for the financial sector? Anton Schutz, president of Mendon Capital, and Fred Cannon, co-director of research and chief equity strategist at KBW, shared their insights.
“We’ve got the scare earlier in the year that this was going to have teeth to it," Cannon told CNBC.
"We got the Dodd bill yesterday and certainly it’s more of a political statement than an ultimate fact statement in that we’re going to be tough on the banks."
Cannon said a lot of the aspects of the bill are not going to work and won't be in the final statement.
In the meantime, Schutz said the larger investment banks are still “very cheap” compared to normalized earnings.
“There will be some dents here and there from things like credit card legislation, from consumer protection, from higher capital, but at the end of the day, a lot of these banks are actually going to start paying dividends and potentially returning capital to shareholders even through things like stock buybacks later in the year,” he said.
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No immediate information was available for Cannon or Schutz.