What were the two main rationale for exempting nonbanks from restrictions on assets and degrees of leverage?

What will be an ideal response?

First, policymakers did not see these firms as being as important to the financial system as were commercial banks, and regulators did not believe that the failure of these firms would damage the financial system. Second, these firms deal primarily with other financial firms, institutional investors, or wealthy private investors rather than with unsophisticated private investors.