How the political agenda has changed. US President Donald Trump sees his country's lenders, like other businesses, as victims of bad deals made behind Americans' backs. The capital levels US banks have been forced to build up have prevented them from lending to smaller businesses, Mr Trump argues. "Frankly, I have so many people, friends of mine, that had nice businesses - they can't borrow money," he told a meeting of business leaders.
House of Representatives member Patrick McHenry, the Republican vice-chairman of its financial services committee, wrote to the Federal Reserve in January to protest the central bank's continued negotiation of international regulatory standards. The US's participation with such forums as the Basel Committee on Banking Supervision and the Financial Stability Board needs to be reviewed, he wrote in a letter published by the Financial Times, adding: "Past agreements... unfairly penalised the American financial system in areas as varied as bank capital, insurance, derivatives, systemic risk, and asset management." Dodd-Frank, the law passed in 2010 to limit proprietary trading and regulate all manner of investment activities, is set to be filleted.
Contrast that tone with the UK's long-awaited white paper on leaving the European Union. "We will seek to establish strong co-operative oversight arrangements with the EU and will continue to support and implement international standards to continue to safely serve the UK, European and global economy," the government promised. Our negotiators will be hoping that President Trump's 'America First' protectionism will make an amicable divorce for the EU and the City more attractive.
There have been good signs. The German finance minister, Wolfgang Schäuble, said in a domestic newspaper interview that the EU wanted a "reasonable" deal with the British, recognising the financial services provided by London. Before a swift Twitter clarification, Brussels' chief negotiator, Michel Barnier, reportedly told a private meeting that a "special/specific" deal would be necessary to avoid "financial instability".
The City hopes to avoid a cliff edge. But a transitional deal faces challenges, with legal experts unsure how the current passporting regime - that allows the sale of services across the single market - could be replaced, even in the short term. The longer term, near existential, questions include whether English law would lose its dominion over certain financial services activities to German law or New York law.
In areas where London leads, such as derivatives, the complexity of the transactions and their settlement frameworks will make business hard to shift in the short term. And there are other advantages to English law - its predictability, flexibility and impartiality. But the loss of applicable EU law will change the nature of contracts, and market participants may decide future business is best written in other territories, especially while the Brexit dust settles.
The US retreat from global standards could provide a short-term boost, reflected in rising share prices for the country's investment banks, as less capital is tied up and trading rules are eased. But as one senior City lawyer put it to me: "If you take away all those safeguards, the question will be what are they going to be replaced by?" Protectionism is likely to mean higher local capital requirements in territories such as Europe, which will weigh on cross-border returns.
In that case, the UK's starting negotiating position of a level playing field could prove attractive for the continent, if it means softening the blow for under-fire lenders such as Deutsche Bank (GER:DBK), as well as the wider corporate sector.
