The White House signaled on Thursday that the United States will spend the next year seeking to make sure that foreign countries implement tough new standards for their banks and financial markets.
“We want a global race to the top,” Treasury Secretary Jacob Lew said in a speech to the Pew Charitable Trust. “Other countries need comparably strong standards and mechanisms to address risks that reach across borders,” he added.
U.S. banks routinely complain that they are being put at a competitive disadvantage relative to their foreign peers by the White House response to the financial crisis and the Dodd-Frank reform law. U.S. regulators are set to complete work next week on the long-awaited Volcker rule.
Proponents of stronger regulation, however, have long argued that foreign countries compete to ease regulations of their domestic banks, calling it a “race to the bottom” on standards and oversight.
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