Obama pushes case for bank reform bill
The president urged tighter regulation when he spoke at Cooper Union in 2008
US President Barack Obama will push the case for more government regulation of big banks in a speech to financial leaders in New York later.
He will warn that if lessons of the financial crisis were not learnt, "we... doom ourselves to repeat it".
He will tell bankers it is in their interests to have fresh regulation and they should not fight them.
The BBC＇s North America editor Mark Mardell said it would be "part-lecture, part-appeal".
President Obama will make the speech at Cooper Union college in New York where, as a Presidential candidate in 2008, he warned that failures of regulation had resulted in "a distorted market that creates bubbles instead of steady, sustainable growth; a market that favours Wall Street over Main Street, but ends up hurting both".
Later that year, the financial system was gripped by crisis after the collapse of the Lehman Brothers investment bank sent shockwaves around the world.
He will tell the Cooper Union audience later: "It is essential that we learn the lessons of the crisis, so we don＇t doom ourselves to repeat it.
"And make no mistake, that is exactly what will happen if we allow this moment to pass - an outcome that is unacceptable to me and to the American people."
Proposed reforms
A bill proposing tighter regulation, which has five major themes, is due to be debated in the US Upper House, the Senate, next week.
It was approved by the Lower House, the House of Representatives, in December.
The proposed rules would include a new body to safeguard consumers＇ rights - a consumer protection agency at the US central bank, the Federal Reserve - which would have powers to regulate all lending.
The bill also includes the formation of a nine-member Financial Stability Oversight Council, which would have powers to break up large companies if they were deemed to pose a threat to the stability of the financial system.
The proposals include setting up a $50bn (£32.5bn) fund to assist with orderly liquidation. But Republicans see this as still allowing taxpayer bail-outs, arguing that any fund could borrow from the Treasury.
The bill also suggests limiting banks＇ involvement in proprietary trading - where they trade their own money rather than that of investors - the so-called Volcker Rule, after the former head of the Federal Reserve who is now an adviser to President Obama.
And it proposes limiting banks＇ investments in hedge funds and private equity funds, and more say for investors on executive pay.
Awkward spot
President Obama has a 59-41 Democrat majority over Republicans in the Senate, but that is one vote short of the number needed.
Republicans largely view the bill as just more government bureaucracy, and they are pushing for parts of it to be changed.
They say the plan would enshrine government bail-outs of big companies.
But full-on opposition to the bill puts them in a awkward spot, says BBC North America editor Mark Mardell.
"If they vote against it they will be painted as the party that backed their wealthy friends on Wall Street, and put at risk the people on Main Street."
If he does succeed in attracting at least the one Republican vote and gets it through the Senate, it will still have to be reconciled in joint committee with the House, before it goes to the president for his signature and becomes law.
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