By Saeed Azhar, Nupur Anand and Tatiana Bautzer
NEW YORK (Reuters) – U.S. bank executives said on Tuesday they expected policy uncertainty to linger as President Donald Trump’s second administration takes shape, but remained optimistic on the economic outlook.
Trump introduced a raft of executive orders, tariffs and personnel changes since he took office last month. In the banking industry, he accused the largest U.S. lenders of shutting down accounts of conservative customers, and dismantled a consumer financial watchdog over the weekend.
More broadly, the administration is going to run a more “growth-oriented agenda,” but the ultimate direction of its policies is more complicated, Goldman Sachs CEO David Solomon told a Miami conference on Tuesday.
“The regulatory environment should be a constructive tailwind, but the broad policy landscape is still uncertain,” he said. “There’s a lot of policy that is shifting, and until we have more certainty on that policy, that’s going to create a little bit of volatility,” he said, citing immigration, tax, energy, trade and fiscal policy.
Markets will likely have “stops and starts” that are beneficial for Goldman’s trading business, he said. Monday’s trading was relatively normal after the two previous weeks started with “exciting and interesting” activity as the administration announced a flurry of executive orders and sanctions.
Wells Fargo’s finance chief Mike Santomassimo told the same conference that clients are optimistic about the economic outlook, and considering mergers and other activities.
“There’s certainly this optimism that the administration is going to be much more pro-growth, pro-business, remove a lot of the obstacles that may get in the way of growing the economy,” he said.
“There’s still some uncertainty in terms of where a lot of the policy may go,” that is causing clients to be cautious about striking deals, but “we still expect to see that momentum,” Santomassimo said.
Keycorp CEO Chris Gorman said clients are upbeat despite the uncertainty created by new import tariffs. He cited a poll among the bank’s clients that showed 62% expect to work on strategic M&A over the next year.
(Reporting by Saeed Azhar, Nupur Anand and Tatiana Bautzer in New York, Niket Nishant and Manya Saini in Bengaluru, editing by Lananh Nguyen, Alexandra Hudson)
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