Repeal of the Glass-Steagall Act separating commercial and investment banking would help European banks operating in the United States, according to a senior European Commission official.
Hugo Paemen, the European Commission ambassador in Washington, told bankers this week in New York that such changes in U.S. banking regulations would be particularly helpful to European banks that have merged with insurance companies but were forced to "de-bank" in the United States because of U.S. restrictions on such alliances.
The official expressed some concern, however, that proposed financial reform measures contained in a House bill could put foreign banks at a disadvantage because of more restrictive supervisory standards.
"Any disparity of treatment between domestic and international banks could either follow from further changes in the legislative process or result from differing standards adopted by the Federal Reserve Board in implementing the legislation," Mr. Paemen noted in a letter to U.S. Treasury and Federal Reserve Board officials this year.
Compiled by James R. Kraus