King calls for new powers to clamp down on banks
Sir Mervyn King, the Governor of the Bank of England, bared his claws yesterday, calling for wide-ranging new powers to clamp down on rogue banks and describing the embattled broker MF Global as "a good example of a company where, frankly, there was no public interest in saving it".
Sir Mervyn wants watchdogs to abandon a rules-based approach to policing banks and instead be given sweeping powers that would enable them to say to banks: "Look, frankly, we don't understand why your organisation needs to be so complex, we can't work out what you are doing, so you're going to have to change it; you haven't broken a rule, but too bad, you've got to change it."
Speaking to MPs in a question and answer session, he said the "culture" of City regulation needed to "get away from this game in which the regulators write ever more complex regulation and the banks and their lawyers [write] new products which are the same, essentially, as the previous products but defined in such a way as to not be caught by the latest rule and regulation".
However, he also warned that watchdogs "can't regulate everything". "So we have to have a framework in which most of these firms can fail. If they screw up, that we just let them go."
Highlighting MF Global he said: "The public interest was in making sure it was possible to administer the failure... without it causing damage to the rest of the financial system. That's what we didn't have when Northern Rock failed. That's what we have now, apart from the very big global cross-border institutions." But, he said, watchdogs and central bankers were "working on it" on an international basis and could find a solution "down the road".
- 1 Planes go hybrid-electric in important step to greener flight
- 3 Antonio Martin shooting: Mayor says there should be 'no comparison' to Ferguson
Nigel Farage defends Kerry Smith 'ch***y' comment: 'If you are going for a Chinese, what do you say you’re going for?'
Rozanne Duncan: Ukip expels councillor for 'jaw-dropping' comments made in BBC TV interview
British actor Idris Elba cannot star as James Bond because he is black, says shock jock Rush Limbaugh
Germany anti-Islam protests: 17,000 march on Dresden against 'Islamification of the West'
Panic Saturday: 13 million Britons spend £1.2bn – while 13 million others across the country live in poverty unable to afford food
BBC director Danny Cohen: Rising UK antisemitism makes me feel more uncomfortable than ever
iJobs Money & Business
Highly Competitive: Selby Jennings: Our client, a leading European Oil trading...
£43500 per annum + pension + holidays: The Jenrick Group: Night Shift Operatio...
£20000 - £25000 per annum + OTE £40,000 + Car + Pension: SThree: SThree are a ...
£20000 - £25000 per annum + OTE £35K: SThree: We consistently strive to be the...