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Radical change awaits banks

Banks are “extremely likely” to face radical change and far tougher rules to stave off any future crises, the Bank of England governor has warned.

Mervyn King warned of the need to examine banking regulation in a speech to the Bank of Israel yesterday.

He says: “The recent challenges presented by the latest episode of financial turmoil suggest that much hard thought will need to be given to the structure and nature of banking regulation in the future.”

King adds: “In the longer-term, it seems extremely likely that banks and other ‘near’ banks, especially those that have been regarded as similar to banks in terms of their eligibility for financial assistance, will be called upon to hold more capital and a greater quantity of liquid assets than hitherto.

“It is too early to foresee clearly where the long-term direction will go.”
King claims a willingness to contemplate radical change will be necessary.

Turning to the domestic banking sector, he says the Monetary Policy Committee must not allow economic growth to slow so slowly that it pushes inflation below the 2% target.


Regulation is a funny old game

Soon after the late and not so great Robert Maxwell came to a briny end, my son bought me a delightful board game that gave me hours of pleasing schadenfreude. Called Maxwell, it was much like Snakes and Ladders. There were dice and counters and when it came to your turn, you threw the dice […]

NR to lend £5bn each year

Northern Rock will lend around £5bn each year during the next three to four years, its executive chairman reveals.Ron Sandler, speaking this morning at a telephone press conference, says he regards this strategy as sufficient to retain NR’s presence in the market.He adds: “We are going to continue to lend money but at nothing like […]

PI overhaul threat to brokers

Brokers have been warned they could risk losing millions of pounds thanks to an overhaul of professional indemnity clauses by policy providers.

In Focus Ebola cover - thumbnail

White paper — In Focus: Ebola Virus Disease

Jelf Employee Benefits focuses on Ebola Virus Disease (EVD) and what this means for businesses with operations in West Africa. This will be of particular interest to those with employees either travelling to, or living within, West Africa, the area affected by the most catastrophic outbreak of Ebola to date.


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