Frank said that under the new regulations, any financial help for a troubled firm like insurance giant AIG would be provided only after it fails and only using money from other banks—not the government.
"If you do get to the point you're so indebted where you can't survive, we'll have to step in with money raised from financial institutions to deal with the consequences of your failure," said Frank. "But nothing can be done until you're put out of existence."
Frank also said that under the bill's regulations, there will be no more 'bad loans' by banks, which he says helped start the financial crisis.
"You won't have sub prime loans where people don't declare their incomes," said Frank. "Bad loans were at the heart of this crisis and now banks won't be able to sell loans and just pass them on to someone else without having sufficient reserve capital."
"Derivatives will be regulated," Frank added. "They will be reported. You'll have to have margin requirements. Anyone selling credit default swaps will have to report them on a regular basis."
Asked why bank stocks were doing well after the announcement of the agreement, Frank said that investors like a measure of certainty. "Uncertainty is the great enemy of markets and with this bill, we have (certainty) now."
Frank also said that the bill, which still has to be passed by Congress and signed into law, will make a future crisis more unlikely.
"I wasn't trying to shoot the banks, I was just trying to regulate them," Frank said. "It's not a perfect bill. We had to make some compromises to get 60 votes, but I think it does the job. People said we wouldn't get this done but we did."