Regulators Weigh Delay for Separating Banks’ Swaps Units
U.S. banks may get another year to shift some swaps trading from their government-insured units as regulators respond to demands to give them more time, according to two people familiar with the talks.
A delay until July 2016 in applying the Dodd-Frank Act separation requirement is being weighed in discussions between bank lobbyists and officials from the Federal Reserve and Office of the Comptroller of the Currency, according to the people, who requested anonymity to talk about the matter.
Six years after the worst financial crisis since the Great Depression, the lobbying underscores the banking industry’s persistence in fighting rules crafted to prevent a repeat of 2008, when taxpayers rescued American International Group Inc. (AIG) after billions of dollars in losses at a swaps-trading unit.
Dodd-Frank requires banks to move certain equity, commodity and non-cleared credit swaps outside of bank units with deposit insurance and access to the Fed’s discount window.
Since 2010, when President Barack Obama signed Dodd-Frank into law, the industry has taken its campaign to Congress and to regulators responsible for drafting the rules.
Barney Frank, who urged revising the measure while serving as House Financial Services Committee chairman, said at a congressional hearing in July that he has changed his mind and now sees it as a good way to make banks safer.
Source: bloomberg- Regulators Weigh Delay for Separating Banks’ Swaps Units
