In the wake of the recent federal election, industry experts anticipate significant changes in the banking and finance sector. With President-elect Donald Trump's proposed policies, including lower interest rates and reduced regulatory oversight, businesses may experience both opportunities and challenges. While some proposals may take time to materialize or face legislative hurdles, financial institutions like Canandaigua National Bank & Trust (CNB) in Rochester/Finger Lakes region are cautiously optimistic about the future. Senior executives at CNB and academic leaders such as Mary Ann Scully from Loyola University of Maryland provide insights into how these changes could reshape the business landscape.

Industry Leaders Weigh In on Policy Changes

In the heart of the Finger Lakes region, managers at Canandaigua National Bank & Trust express a mix of optimism and caution regarding the new administration’s plans. Senior Vice President Brendon Crossing highlights that while Trump’s policies could benefit businesses generally, the transition period might be slow. Similarly, Kevin DiGiacomo, another senior executive at CNB, advises clients to remain flexible and ready to adapt as policy directions become clearer. The early months of the administration are likely to be more about discussion than action, as many changes require Congressional approval.

Mary Ann Scully, dean of the Sellinger School of Business at Loyola University of Maryland, emphasizes the importance of tax and regulation policies for the banking sector. She notes that extending provisions from the 2017 Tax Cuts and Jobs Act could stabilize the environment initially, but warns of potential long-term issues like increased budget deficits. Deregulation, while beneficial for banks, could also lead to increased merger and acquisition activity, which has been limited recently. Additionally, she raises concerns about tariff increases and deportation plans, particularly their impact on industries reliant on immigrant labor.

Jess LeDonne, director of policy and legislative affairs at The Bonadio Group, stresses the need for patience and preparation as businesses navigate this uncertain period. While deregulation and tax cuts could stimulate growth, higher interest rates and unsustainable deficits loom as potential risks. LeDonne advises companies to closely monitor supply chains and federal programs they rely on, as these areas may see significant changes under the new administration.

The immediate market reaction to the election results has shown favor towards U.S. investments, small-cap stocks, and regional banks. However, pro-growth initiatives could also lead to higher inflation and wider budget deficits, according to J.P. Morgan Private Bank’s economic outlook for 2025.

Reflections and Implications for Businesses

As the dust settles post-election, it is evident that the banking and finance sector stands at a crossroads. The proposed policies promise both opportunities and risks. For businesses, staying adaptable and informed will be crucial. Leaders like Scully and LeDonne urge companies to focus on risk management, maintain strong customer relationships, and prepare for potential shifts in tax and regulatory landscapes. While the full impact remains to be seen, the coming months will undoubtedly bring significant changes that could redefine the business environment. Businesses should stay vigilant and ready to pivot as necessary to thrive in this evolving climate.