U.S. financial reform moves step closer

A U.S. bill to increase regulation of Wall Street took another step towards passage Monday as a second Republican senator said that after some misgivings he would support the legislation after all.

Scott Brown of Massachusetts joined Senator Susan Collins of Maine as two crucial Republican votes for the legislation.

Most Republicans have lined up against the bill.

Democratic leaders were still looking to secure the 60 votes needed. With Collins and Brown, the bill now appears to have the support of 59 senators.

The vote could be delayed beyond this week, until a replacement is named for the late Senator Robert Byrd, who died last month.

Brown won concessions in the bill and said Monday that the legislation "is a better bill than it was when this whole process started."

"While it isn't perfect, I expect to support the bill when it comes up for a vote," he said in a statement.

"It includes safeguards to help prevent another financial meltdown, ensures that consumers are protected, and it is paid for without new taxes."

The 2,400-page financial overhaul legislation has already been passed by the U.S. House of Representatives.

It creates new rules for complex securities blamed for helping precipitate the economic crisis in 2008 and provides for a new agency assigned to protect consumers from potentially dodgy financial products, including mortgages.

The new rules will still allow banks to invest in hedge funds and private equity funds, but with only up to three per cent of their own capital, and only so long as that investment is "walled off" from the bank and held in a separate subsidiary.