In an effort that was almost two years in the making, a financial regulatory reform bill, the Restoring American Financial Stability Act of 2010, passed the Senate yesterday. That bill now must be reconciled with a similar bill that passed the House in December, a process expected to take a few weeks.
Off the table is the Volcker rule, which would have would ensured no bank or financial institution that contains a bank will own or sponsor a hedge fund or private equity fund or proprietary trading operations unrelated to serving customers. Also rejected was an amendment that would have restricted shareholder ownership of a clearinghouse by large banks to 20%. Still to be decided is the Senate proposal that would require banks to spin off their derivatives business to retain FDIC insurance.
New regulatory reform will definitely affect the way that traders do business, with different reporting requirements and procedural changes. How will it affect YOUR trading business? Leave your comments below.