Banks face ‘decisive’ two years









Mark Carney says that 2013 and 2014 are going to be decisive years for financial sector reform



The incoming governor of the Bank of England has said the next two years will be “decisive” for bank reform.


Mark Carney, current governor of the Bank of Canada, said “shadow banking” and the issue of “too big to fail” would be tackled.


The 2008 crisis would be repeated if unregulated financial activities – blamed for amplifying the meltdown – went unchallenged, he said.


He also warned that central banks alone could not eliminate “tail risks”.


He said that, contrary to some reports, tail risks – essentially worst-case scenarios – in Europe and the United States remained.


Shadow banks are companies that operate like banks but fall outside current oversight.


“The next two years will be decisive on ending ‘too big to fail’ [for banks] and addressing shadow banking and over-the-counter derivatives, that absolutely amplified the last crisis – and will do so again if we don’t complete our agenda,” he told an audience at the World Economic Forum in Davos.


Continue reading the main story



The calm mood in sunny Davos is open to interpretation. It might be tempting to see it as a reflection of hope that the global economy is back on track and picking up pace.


But equally, it could be taken as a sign of exhaustion, bringing pause to an economic crisis that has been long and tiring.


Nobody here expects a sharp and sudden recovery, especially not in the US or the eurozone.


But these days, politicians and business leaders seem happy as long as they are not in the eye of a storm.



Over-the-counter derivatives – unregulated because they are privately negotiated between two parties – were blamed for exacerbating the financial system.


Mr Carney takes up his new position at the Bank of England in June.


His comments could hint at what is to come when he succeeds Sir Mervyn King at the Bank, which has seen its financial regulatory powers increase since the financial crisis.


Meanwhile, International Monetary Fund managing director Christine Lagarde, who was also present on the panel with Mr Carney, warned that countries should keep up with reforms, especially in the eurozone, to pursue banking and fiscal union while keeping pace with structural reforms.


BBC News – Business





Title Post: Banks face ‘decisive’ two years
Url Post: http://www.news.fluser.com/banks-face-decisive-two-years/
Link To Post : Banks face ‘decisive’ two years
Rating:
100%

based on 99998 ratings.
5 user reviews.
Author: Fluser SeoLink
Thanks for visiting the blog, If any criticism and suggestions please leave a comment




You're reading an article about
Banks face ‘decisive’ two years
This article
Banks face ‘decisive’ two years
can be opened in url
http://highbeams891.blogspot.com/2013/01/banks-face-decisive-two-years.html
Banks face ‘decisive’ two years