Scenarios- What will banks do with their swaps dealerships-



Once enacted, big banks such as Citigroup, JPMorgan Chase and Bank of America Corp won’t be able to sell swaps on most commodities, equities and credit through entities connected to their commercial banks. Instead, they’ll have to set up new units, or do away completely with that type of trading,news political.

Still, the spinoffs will add to bank holding companies’ business and funding costs.

Below are scenarios for the method banks will use to purge the trading of “bad” derivatives from their banking businesses.

A “BAD” DERIVATIVES AFFILIATE

One former executive milf porn at a major bank said that a dealer could set up a bank listed overseas, and capitalized entirely by third-party investors.

Under this scenario, the larger bank could then collect a fee for referring derivatives trading business to the newly created smaller bank, similar to the relationship between an insurer and an agent that works mobile porn exclusively with the insurer.

One difficult element of this plan would be getting customers comfortable with the credit of the smaller bank, but if the subsidiary is publicly listed and its financial statements are disclosed, that problem can be surmounted, the executive said.

MULTIPLE AFFILIATES


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