Marshall Talks About Proposed Federal Regulations on Financial Institutions
“Concerns Over Latest Financial Regulatory Proposal”GlobeSt.com
January 24, 2010 – In early January, President Barack Obama proposed implementing new rules that would rein in the size and scope of the largest financial institutions. Although details were scant, certain proposed measures included restrictions on some banks’ ability to trade securities – including mortgage backed securities – for their own account or set up in-house hedge funds. GlobeSt.com looked to Ellen R. Marshall, co-chair of the Manatt’s Banking and Specialty Finance practice group, for analysis.
The measures, which have been interpreted to mean a reintroduction of tighter controls over the risks banks were allowed to take under the Glass-Steagall Act, would be on top of the proposed Consumer Protection Financial Agency that has been introduced in legislation. Angst, the article says, over the proposed measure is widespread, both in the general market and the more narrow commercial real estate finance space.
Marshall told the publication that much of the concern is that the proposed measures introduce yet another element of uncertainty in what has been a turbulent year.
"That just leads to an even greater reluctance on the part of banks to lend," she told GlobeSt.com. “Bankers who do not know if they are going to be restricted in how they can finance their portfolio of loans or hedge them, will certainly become more reluctant to expand that portfolio, at least until the new rules are in place.”
Read the article here.
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