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| Economy |
| US banks set to lose swaps fight |
| 2010-06-13 |
| Banks are likely to lose a key lobbying battle in the US over whether they will be forced to spin off their lucrative swaps desks, according to people familiar with financial reform negotiations in Congress. Defeat, which would be a further blow to Wall Street, has been made more likely by Paul Volcker, the influential former Federal Reserve chairman, softening his opposition to the provision. Blanche Lincoln, the Senate agriculture chairman, is the lead proponent of the plan, which would force banks to create a separately capitalised subsidiary to house the derivatives dealing operations – a significant source of profits for big banks, such as JPMorgan Chase. The expensive restructuring could drive activity out of the largest Wall Street banks and into more lightly regulated rivals and overseas competitors, according to the Federal Reserve and Federal Deposit Insurance Corporation, which oppose the plan. |
| Posted by:tipper |
| #1 Pretty much a case of setting up two sewage authorities, one to handle #1 and another to handle #2. Disposition of diahrrea and puke yet to be determined... |
| Posted by: M. Murcek 2010-06-13 21:24 |