Global investors support U.S. legislation that would raise capital requirements for banks and strengthen consumer financial protection, even as they oppose the so-called volcker rule to ban proprietary trading by financial institutions, a bloomberg News survey shows.

Seven out of 10 investors support moving trades of standardized derivatives to exchanges while slightly more than half reject a rule that would force financial companies to separate their swaps desk from commercial banking, according to a global quarterly poll of investors and analysts who are bloomberg subscribers.

Investment professionals said they want to see changes to rein in risk-taking, the survey showed, even after wall street firms spent months lobbying against much of the regulatory overhaul put forth by President barack obama and U.S. lawmakers.

“‘Stop us before we break the economy again,’ seems to explain why they are not just accepting of new regulations, but think they are a good idea,” said J. Ann Selzer, president of Selzer & Co., the Des Moines, Iowa-based firm that conducted the poll.

Regional differences were pronounced on the swaps-desk and consumer-protection provisions. Forty-six percent of Asian investors in the survey said they supported the separating the trading desks, compared with 33 percent of U.S. investors.

‘Fictitious Investments’

Walling off swaps desks from commercial banking “would ensure that capital is not taken from other banking areas and used to meet regulatory requirements of derivative trading or cover the losses being experienced in derivative trading,” said poll respondent Raphael de Santos, a U.K.-based analyst. “This will mean that capital needed for the real economy, personal and corporate lending, won’t be taken up by fictitious investments.”

Establishing an agency to oversee consumer financial protection was favored by 51 percent of U.S. respondents, while 43 percent said they thought it was a bad idea. Support was higher in Asia, with 80 percent of investors favoring the idea, and in Europe, where 66 percent said it’s a good idea.

“We need some kind of protection for the consumer, yes we do. I don’t think a federal consumer agency is going to do the job,” said respondent Joseph Offerman, a financial adviser at Merrill Lynch & Co. Inc. in Clearwater, Florida. “Bigger government has not proven to be helpful in any way shape or form.”

Almost three-fourths of all investors said they opposed the proposal that would prevent banks from trading for their own investment book under a rule named for Paul Volcker, the former Federal Reserve chairman who proposed it.

‘Reduce the Risk’

Investors across the globe said banks should be required to hold more capital, with 79 percent of U.S. investors, 73 percent of Europeans and 74 percent of Asians supporting higher capital ratios.

“This would really reduce the risk in the system,” said respondent albert ohandjanians, head of multiasset portfolio management at Pioneer Investments austria, a unit of unicredit group. “It will lead to a shrinkage of the whole credit system. But banks then will fairly reduce their leverage and not be as vulnerable as they still are to some sort of asset deflationary process.”

Capital ratios should be boosted to between 15 and 20 percent, Ohandjanians said.

Fifty-nine percent of poll respondents said it’s a good idea to require hedge funds to register with the U.S. Securities and Exchange Commission and regulate them more closely.

Stock Plunge

In relation to the 30-minute, 1,000-point drop in the stock market on May 6, more than half of investors agreed with the statement that computer-driven trading “has gotten out of control” and should be better regulated. About one-quarter, however, said computer trading is “the wave of the future.”

The U.S. Senate last month approved the most comprehensive regulation of the financial industry since the great depression aiming to prevent a repeat of the economic crisis that followed the collapse of the subprime mortgage market in 2007.

Senate and House negotiators are scheduled to begin meetings this week designed to merge their separate bills into a single piece measure that obama can sign into law.