"Regulators are finally closing in on banks."

John Gapper in the FT: “It has taken a long time for the authorities on both sides of the Atlantic to address some of the deep-seated problems that contributed to the crisis. But they are now doing so, despite all the lobbying and protests. Few bankers have gone to jail, but the industry is being disciplined.” “This week brought two announcements that strike at the distortions caused to banking by cheap credit and the underpricing of risk over past decades. One was the US Federal Reserve’s decision to implement the Basel III capital rules, and to add extra measures. The other was the European Commission’s assault on how banks trade credit derivatives. …..Such initiatives address one of the biggest weaknesses exposed by the 2008 crisis – over-the-counter trading of credit default swaps without an adequate capital cushion contributed to the near-collapse of AIG. More broadly, banks held too little capital for the risks they were unwittingly taking, as many discovered.”