Brussels is set to ease flagship financial reforms so that big European banks are not automatically forced to split lending operations from risky trading.
In a draft European Commission plan, seen by the Financial Times, the separation is no longer mandatory and would be less costly and restrictive than first envisaged. National supervisors are given wide discretion in applying the reforms.
In a further twist, the commission adds its own “narrowly defined” version of the US Volcker rule, which outlaws proprietary trading. The ban applies to about 30 big banks, regardless of whether their deposit-taking part is fenced off.
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