23 Apr 2010

Bank reform needed to avoid another crisis - Obama

7:09 pm on 23 April 2010

United States President Barack Obama has attacked critics of proposed banking reforms in a speech which warned that without change, the financial crisis will be repeated.

Mr Obama told an audience of bankers and financial experts at the Cooper Union College in New York that financial firms that acted like bandits should never be allowed to operate again.

The president said regulatory reform is in the financial sector's interests, and bankers and lobbyists should not fight against it.

A bill proposing tighter regulation is due to be debated in the US Senate next week. It was approved by the House of Representatives in December.

The proposed rules include limiting banks investment options, more say for investors on executive pay and a consumer protection agency at the US Federal Reserve, which would have powers to regulate all lending.

However, Doug Elliot of the Brookings Institute does not think Wall Street will be moved by what it sees as political theatre.