How did the deregulation of U.S. bank activities affect the patterns of cross-border lending to emerging economies? Unlike bank lending from Europe or Japan, U.S. bank lending to emerging economies exhibited increasing volatility over time. Using U.S. cross-border bank exposure data, this study identifies a temporal association between important deregulation initiatives and the volatility of U.S. bank emerging market lending. This association is explained by the linkages between an important outcome of bank deregulation－earnings volatility from diversified bank activities－and the rising volatility. Together, it argues that U.S. banking deregulation had unanticipated effects of exacerbating the volatility of bank lending to emerging economies.