Obama outlines banking reform proposals

Barack Obama has responded to the recent financial crisis by outlining new plans to reform the banking system in the US.

The president said he intends to limit the size of financial institutions, as well as put a cap on the amount of risky trading they are allowed to undertake.

As a result, some of the country’s biggest banks may have to be broken up in order to comply with the outlined legislation.

Mr Obama said that although the country’s financial system is beginning to regain its strength, it is still ’operating under the exact same rules that led to its near collapse’.

’Never again will the American taxpayer be held hostage by banks that are too big to fail,’ he added.

The news has caused stock markets around the world to fall, with the Dow Jones ending two per cent lower as financial shares fell and the Nikkei 225 also retreating.

In the UK, however, the FTSE has responded to the news with a slight climb.

According to Reuters, the index was up 0.03 per cent to 5,336.92 points at 09:40 GMT, despite a number of financial institutions sliding.ADNFCR-2318-ID-19572217-ADNFCR