As market participants and observers assess how the incoming Trump administration will approach regulating U.S. capital markets, the leadership of the Securities Industry and Financial Markets Association believes that now is a good time for market regulators and the industry to evaluate what is and is not working.

“Although innovation may have outpaced regulation before the crisis, we now have to consider if that pendulum has swung too far,” said Timothy Scheve, Sifma chair and CEO of Janney Montgomery Scott, at a press briefing in New York on Tuesday. “Are we getting too far away from actualizing the benefits of stable, well-functioning markets?”

“We need to have regulatory balance,” Scheve continued. “We need to review the industry regulations to ensure that they are working as they were intended and not creating unintended consequences that inhibit economic growth in capital formation.”

An example of unintended consequences and conflicting regulations is the regulatory push to have as many derivative trades centrally cleared but then being penalized regarding a firm’s supplemental leverage ratio, according to Kenneth Bentsen, Sifma CEO.

“We have been saying this for the last several years and will continue to say that where you can have more efficient and smarter regulations, it will help spur more capital formation, economic growth, and job creation,” he said.

Bentsen stated that the US could learn from the regulatory approach used by Jonathan Hill during his tenure as European Commissioner for Financial Stability, Financial Services and Capital Markets Union and by his successor.

“They looked to see how all of these rules are working and whether they were working as they had been intended,” said Bentsen. “We’ve been saying the same thing in the US for the last several years. It would be good for regulators to stop and take a look.”

According to Bentsen, the European regulators found the approach useful in their development of Capital Requirements Directive 5.

“Their intent was to include potential proposals where they might make modifications and recalibrations,” he said. “There is nothing that precludes the Department of the Treasury or individual regulators to put out such a request for information. They’ve done it in other areas over the years and allow market participants, the public, and others to comment.”

However, this is a decision for the policy makers to make, according to Bentsen.

In the meantime, Sifma intends to say the same things to the Trump administration as it has been saying to the Obama administration for the last several years, he said.