U.S. regulators face renewed pressure from congressional lawmakers to ease Dodd-Frank Act derivatives requirements amid mounting criticism from Wall Street and overseas officials that the rules overreach.
The House Financial Services Committee is scheduled to vote on nine measures that would allow more swaps to be traded in units of banks such as JPMorgan Chase & Co. and Citigroup Inc. that hold government-insured deposits. One measure would force U.S. regulators to determine the cost of new Basel III capital charges on banks’ swaps with corporate clients.
European Union lawmakers insisted on granting exemptions in Basel rules from the credit valuation adjustment, or CVA, to banks’ trades with companies in industries such as energy and chemicals that use swaps to hedge against price swings. The European lawmakers warned that applying the Basel rules as planned would drive up such companies’ costs.