Fed Chairman Ben Bernanke believes that a proposal to separate commercial banks from their swaps trading desks “would weaken both financial stability and strong prudential regulation of derivative activities.”
Bloomberg : “Prohibiting depository institutions from engaging in significant swaps activities will weaken the risk mitigation efforts of banks and their customers,” Bernanke wrote in a May 12 letter to Senate Banking Committee Chairman Christopher Dodd, according to a copy obtained by Bloomberg News. “Depository institutions use derivatives to help mitigate the risks of their normal banking activities,” he said in the letter.
Disclaimer: This page contains affiliate links. If you choose to make a purchase after clicking a link, we may receive a commission at no additional cost to you. Thank you for your support!