Concern about bank clampdown

Andrew Sentance, a member of the Monetary Policy Committee, has warned that heavy-handed bank regulation could lead to negative consequences.

In a speech to attendees at a monetary policy conference in London, Sentance says: “There is a danger of unintended consequences from heavy-handed regulatory interventions in the banking sector.

“That’s why we need to take the time to decide what a new regime for regulating the sector should look like. This is a key economic policy issue in light of the current crisis.”

Regulation has taken centre stage in the past few months as bank executives have come under fire for poor risk management and have faced accusations of irresponsible lending.