If signals being floated by a Democratic leader in Congress and the White House are to be taken on face value, banks won't be forced to spin off their derivatives desks.
The measure is part of the Senate's version of financial reform -- a massive piece of legislation that will rewrite the rules of the U.S. financial system. The House version of the bill doesn't include the spin-off requirement. The bills must be reconciled before the new rules go into effect.
For his part, Barney Frank (D-Mass.), who is the House Financial Services Committee chairman, said the requirement “goes too far.” Meanwhile, a senior Treasury official reportedly said the derivatives provision is not what the Obama administration considers part of the “core” package of reform.
- Obama admin cool to bank swap-trade spin-off plan
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- White House Signals It Won't Fight to Keep Rule on Derivatives
