by Amy Scott

By one estimate in the Wall Street Journal, the Senate bill could cut profits at the big banks by about 20 percent. That’s thanks to restrictions on trading in risky investments like derivatives.

Charles Calomiris teaches finance at Columbia Business School. He says lawmakers caught up in public outrage against the banks may in fact hurt the public.

“Global banking is in the service of global economics. If you start trying to turn the largest global banks into mom-and-pop, deposit-taking and lending institutions, you do a huge amount of damage, not just to the banks and their profits, but to the operation of global markets,” he says.

Calomiris says that could raise the cost of borrowing for everyone and push more financial business overseas.

But law professor Howell Jackson at Harvard says overall, the bill is good for consumers.

“There’s a lot to like in this bill. There’s plenty of attention on small controversial issues,” says Jackson. “But in the scheme of things, I think this is very successful piece of legislation.”

Jackson especially likes measures that would centralize consumer protection and monitor risk in the financial system.