Hoenig: Glass-Steagall hard to bring back but appealing

NEW YORK, June 30 (Reuters) - Rebuilding barriers between commercial and investment banking operations would be difficult but probably would help avoid some problems in the U.S. financial sector, Thomas Hoenig, president of the Kansas City Federal Reserve Bank, said on Tuesday.

"It would be hard to go back" to the Glass-Steagall Act, Hoenig, speaking at an event at the New York University Stern School of Business, said in answer to a question on the 1933 U.S. law.

But he said there is a "good case" to split commercial and investment banking operations, adding a "devolution of banking across the country again would serve us well."

The Depression-era Glass-Steagall provisions set up barriers between commercial banks and investment banks. That law was swept aside in 1999, permitting companies to mix banking with other financial activities.

(Reporting by Steven C. Johnson, Editing by Chizu Nomiyama)