President Obama's proposals to limit the size of banks helped wipe out $430 billion of financial companies' stock market value and also made their bonds irresistible to some of the nation's biggest investors.

Banks in the MSCI World Index fell 7% since Jan. 12, while the extra yield investors demand to own their bonds instead of Treasuries widened to 238 basis points, from a low of 224 basis points, or 2.24 percentage points, on the same day, according to the Bank of America Merrill Lynch U.S. Corporates, Banks Index.

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