Financial Post | Business

Jim Flaherty, Canada’s federal finance minister, added his voice Monday to a chorus of complaints about a key plank of banking reform in the United States.

In a strongly worded letter to U.S. Treasury Secretary Timothy Geithner, Mr. Flaherty said the Volcker rule “could have material adverse effects on Canadian financial institutions and markets.”

The finance minister said he is “particularly concerned that the proposed rule could severely impact the liquidity of Canadian government debt markets and interfere with the risk management practices of banks in Canada.”

Bank of Canada Governor Mark Carney also stepped forward on the last day of a comment period on the controversial Volcker Rule, which has drawn sharp criticism from senior officials around the world.

In a letter to U.S. Federal Reserve Chairman Ben Bernanke, Mr. Carney proposed changes to the legislation that would exempt Canada from two of the most controversial elements including restrictions on trading…

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