The top U.S. derivatives watchdog voted on Friday to allow U.S. banks operating overseas to be governed by foreign rules in some cases, soothing some Wall Street concerns that banks might have to comply with both U.S. and foreign regulations.
The Commodity Futures Trading Commission adopted the plan in a public vote at its headquarters, a day after it ended a monthslong trans-Atlantic rift with European regulators over how to address the complex issue of cross-border trading of derivatives.
Under the CFTC's guidance, foreign branches of U.S. banks will be allowed to operate under other countries' regulations for some trading rules, though the CFTC will first determine whether the foreign regulations are sufficiently tough.
The CFTC also granted banks a period of delays during which the new rules would be phased in.