PARIS: French and British banks are urging the European Commission to reconsider plans to isolate high-risk trading activities at big banks, warning the move could discourage lending to struggling economies.

The European Union’s executive arm published a draft law in January that would ban banks considered “too big to fail” from proprietary trading — making bets on stocks, bonds and commodities for their own accounts.

The reform aims to avert a repeat of the costly bank collapses of the 2008-2009 financial crisis.

But the French and British banking associations said: “There is a serious risk that the structural reform measures, as currently proposed, would constitute a considerable handicap in financing European companies, thus running counter to the European Union’s efforts to restore growth and improve employment.”

Published in Dawn, November 25th , 2014