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fbtwitterlinkedinvimeoflicker grey 14rssslideshare1
Clayton, N. A. (2013)
Publisher: Palgrave Macmillan
Languages: English
Types: Article
Subjects: HG, KZ
After the collapse of a number of banking institutions and bailouts of banks by governments, regulators have taken a different attitude and now appear keen to take regulation seriously when it comes to ensuring that banks have adequate capital and sufficient liquidity. Not only that, but in the United Kingdom, the Independent Commission on Banking Reform has made proposals with regard to the capital position of banks. This article, which is an overview, will look at matters from a UK perspective and at the proposals for reform. This article, after its introduction and summary, will look at a number of areas: first, the reforms made by Basel III; second, the regulation of Systemically Important Financial Institutions (Sifis) and the proposals for dealing with these; third, some matters in relation to lending that relate to capital and liquidity generally; fourth, increased stress testing of banks; fifth, derivatives and risk taking and the new proposed structure of regulation in the United Kingdom; sixth, the war of spin between regulators and banks; seventh, Shadow Banking; and eighth, The Independent Commission on Banking Reform and its proposals for reform. It will also be a theme that the various proposals lack consistency and that this could lead to regulatory arbitrage. It is already clear that there are inconsistencies between the various regulatory organisations, with proposals in the United Kingdom indicating that banks will be required to keep much higher levels of capital than those proposed by Basel and the European Community. The views of those who have pointed out inconsistencies between the United Kingdom and Basel/Europe have been highlighted.
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    • 1 See generally: Arora, A. (2010) The global financial crisis: A new global regulatory order?. JBL 8: 670-699, In contrast to that article, this article will look at regulation from a UK perspective and how it has been affected by Basel III.
    • 2 Jenkins, P. (2011) Quality of stress testing disclosures a mixed bag. Financial Times, 18 July.
    • 3 These concepts are discussed subsequently in part 1: Basel III.
    • 4 See the large number of informative pieces in the Financial Times about these.
    • 5 See the subsequent discussion of these in Section 'Responsible Lending'.
    • 6 Jenkins, P. (2011) Quality of stress testing disclosures a mixed bag. Financial Times, 18 July 2011. See also page 1 of the Financial Times, 19 July 2011; in a section with a heading 'UK banks hit hardest' it is alleged that one bank had used a loophole to avoid disclosure about its exposure in Ireland. implemented through the capital adequacy directive and through rules and regulations of the UK regulatory authorities. Christos Hadjiemmanuil, Banking Regulation and The Bank of England LLP 1996, talks about the implementation of Basel I and in footnote 88 at page 203 he writes: 'Remarkably, nobody questioned the validity of the Bank's quasi-formal implementation of the formally nonexistent international document'. See in addition: D.E. Ho, 'Compliance and international soft law: Why do countries implement the Basle Accord?' 1 August 2002 JIEL 5(3): 647-688.
    • 14 Alexander, K. (2004) Editorial: Why banks hold capital in excess of regulatory requirements: The role of market discipline. Journal of International Banking Regulation 6(1): 6-9.
    • 15 Professor Norton, J.J. confirms the point that the Basle Committee's proposals in the European Union 'will be enacted through formal legal means. In: J.J. Norton (ed.) Bank Regulation and Supervision In The 1990's. Lloyd's of London Press Ltd, Appendix (to Chapter 5) Background note on the Basle Committee Joseph J Norton.
    • 16 Mervyn King in response to question 8 of Stewart Hosie: The Uncorrected Transcript of Oral Evidence to be published as HC 430 -i: House of Commons Minutes of Evidence Taken Before Treasury Committee Financial Y Regulation Wednesday 28 July 2010. This is an oral transcript and witnesses and Members of Parliament have seen below, the IndPependent Banking Commission is not had an opportunity to correct the record. As will be seeking to introduce higher levels of capital reserves than O those proposed by Basel III. Simon Gleeson makes the point that for European Union Law and the Basel rules to be industry. CGleeson, S. (1999) A journey from Basle to different would be highly damaging for the banking Brussels. Journal of International Banking Law 14(9): 275-276, See also S. W. K-S Reforming regulatory capital: The REuropean response to the financial crisis (2009) 10 JIFBL 603. See generally: Norton, J.J. (1995) Devising International Bank Supervisory Standards. London/Dordrecht/Boston: Graham & Trotman/Martinus Nijhoff, pp. 176-177.
    • 18 As is pointed out by Walker, G.A. (2010) The global credit crisis and regulatory reform. In: I. MacNeil and J. O'Brien (eds.), Chapter 11 The Future of Financial Regulation. Oxford and Portland, Oregon: Hart Publishing.
    • 19 Ho, D.E. (2002) Compliance and international soft law: Why do countries implement the Basle accord? 1 August 2002 JIEL 5(3): 647-688, in the Introduction section.
    • 20 Tarullo, D. (2010) Next steps in financial regulatory reform. at the George Washington University Centre for Law, Economics and Finance conference on the Dodd-Frank Act, Washington DC, 12 November 2010, at page 5.
    • 21 Wellink, N. (2009) Basel Committee initiatives in response to the financial crisis. Remarks before the Committee on Economic and Monetary Affairs of the European Parliament, Brussels, 30 March 2009.
    • 22 By Jean-Claude Trichet, chair of the Basel negotiating group and president of the European Bank: R Mason, Banks told to double their cash reserves, Daily Telegraph, 13 September 2010 and B, Masters, Basel deal reached on banks' reserves, Financial Times, 13 September 2010.
    • 23 Barr, M.S. and Miller, G.P. (2006) Global administrative law: The view from Basel. 1 February (2006) EJIL 17(1): 15-46, in section 2 Basel and Globalization's critics. B Masters has indicated that six out of 27 countries failed to implement Basel II. B. Masters, Countries fail to enact Basel banking reforms, Financial Times, 19 October 2011.
    • 24 These will be discussed later on in this article.
    • 25 Tait, N., Masters, B. and Braithwaite, T. (2011) IMF backs UK push on tighter bank rules. Financial Times, 7 June 2011. The FSA have previously researched as to the extent to which Basel II and the Capital Requirements Directive were being implemented in a consistent way: FSA Basel 2/CRD implementation in other jurisdictions and the FSA's work in EU and Global Committees.
    • 26 Jenkins, P. (2011) Drive for global standard on banks' lending risks. Financial Times, 3 May 2011.
    • 27 Ho, D.E. (2002) Compliance and international soft law: Why do countries implement the Basle accord?. 1 August (2002) JIEL 5(3): 647-688, in the Conclusion section.
    • 28 See subsequently where the need for 'an aggregate leverage ratio' is explained by Sir John Vickers.
    • 29 Uncorrected Transcript of Oral Evidence: To be published as HC 1069-i. House of Commons Oral Evidence Taken before the Treasury Committee: Independent Commission on Banking, 24 May, Sir John Vickers, Martin Taylor and Bill Winters: In response to Q90 by Stewart Hosie; Sir John Vickers replied as is quoted above. Neither witnesses nor Members have had the opportunity to correct the record.
    • 30 Molsostova, I. (2009) Revision of the European regulatory capital regime. JIBFL 1: 20, 1 January 2009.
    • 31 Chan, W.K., Masters, B. and Hingel, G. (2010) Basel III: The impact on bank capital. FT.com, 19 November 2010.
    • 32 Nexis, L. (2010) European developments: Capital requirements Basel III. Banking Law Update, October 2010.
    • 33 Gleeson, S. (2009) Macroeconomic regulation: New regulators, new powers. Capital Markets Law Journal R4(1): S99-S111, in particular Section 3 which asks the question grated into prudential regulation. O about whether macroeconomic regulation could be inte-
    • 34 Testimony of H Scott: Before the Committee on Financial H Services United States House of Representatives, 16 June 2011: Section C: Differential Impact at page 18.
    • 35 Paragraph 2.52 of A new apTproach to financial regulation: building a stronger system February 2011 Cm 8012. Building a stronger sUystem, February 2011 Cm 8012. This
    • 36 Paragraph 2.52 of A new approach to financial regulation: ability to increase the buffer by 2.5 per cent is noted by Walker, G. A(2011) Basel III market and regulatory compromise. Journal of Banking Regulation 12: 95-99.
    • 37 Masters, B. (2011) Bank regulators agree on global sweep to tackle credit bubbles. Financial Times, 11 January 2011, where Paul Tucker is quoted as saying: 'This is very significant because it takes the regulatory community into protecting the health of the entire system rather than just individual banks'.
    • 38 Caruana. (2010) Macroprudential policy: Could it have been different this time? People's Bank of China seminar on macro-prudential policy in cooperation with the International Monetary Fund, Shanghai, Monday, 18 October 2010.
    • 39 Wellink, N. (2008) The importance of banking supervision in financial stability. Keynote address at Beijing 17 November 2008 on The Role of Banking and Banking Supervision in Financial Stability: Bis Review 138/2008.
    • 40 Wellink, N. (2010) The Basel committee and regulatory reform. Institute of International Finance 2010 Spring Meeting, Vienna, Austria, 11 June 2010.
    • 41 Mr Green, head of the capital committee of Institute of International Finance: Quoted from Masters, B. and Goff, S. (2010) Plea for bank reform by end of year. Financial Times, 19 May 2010.
    • 42 FSB: Macroprudential Policy Tools and Frameworks: Progress Report to G20, 27 October 2011, at page 12.
    • 43 Tucker, P. (2011) Macroprudential policy: Building financial stability institutions. Speech at the 20th Annual Hyman P Minsky Conference, New York, 14 April 2011, at page 15 (available B of E website).
    • 44 Hills, B. and de Remusat, M. (2010) Global and G20. Compliance Monitor 17 December 2010. See generally M Ojo: Preparing for Basel IV - 'Why Liquidity Risks Still Present a Challenge to Regulators in Prudential Supervision' (II).ssrn.com/abstract 1732304, 30 December 2010. See also B. Masters and P. Jenkins, Basel reveals liquidity gap for biggest banks, Financial Times, 17 December 45 Walker, G.A. (Y2010) Capital and liquidity revision. Financial 2010.
    • 46 Wellink, PN. (2010) Fundamentally strengthening the Regulation International, November 2010. regulatory framework for banks. at the FSB Financial OReform Conference: An Emerging Market Perspective Seoul, Republic of Korea, 3 September 2010.
    • CWalker, G. (2009) Liquidity risk management - Policy 47 See the discussion on stress testing below. See generally, conflict and correction. Capital Markets Law Journal 4(4): 451-461.
    • 48 Masters, B. (2012) Basel rejects delay to liquidity buffers. Financial Times www.ft.com, 8 January 2012.
    • 49 Masters, B. (2010) Banks learn the liquidity lessons from tough rules. Financial Times, 30 December 2010.
    • 50 www.parliament.uk/busines/committees/committees-a-z/ commons-select/treasury.
    • 51 Andrew Tyrie's letter dated 20 October 2011 to both Mervyn King and Hector Sants is downloadable from this site above. The lack of discussion about liquidity by the Independent Commission on Banking is commented upon in the section on Liquidity and Funding from the wider group by Penn, B. and Dewji, I. (2011) The Interim report of the ICB: What does a ring-fenced bank look like? (2011) JIBFL 7: 382.
    • 52 Speech by Paul Tucker, Deputy Governor, Financial Stability, at the Investment Property Forum's Alastair Goobey Memorial Lecture, London, 12 June 2012. The interaction of the PRA, the FCA, the FPC and the MPC to be brought under the one body, the Bank of England under the Financial Services Bill 2012 are necessarily outside the scope of this article.
    • 53 Brammertz, W. (2010) Risk and regulation. J.F.R. & C 18(1): 46-55, at page 47.
    • 54 Laker, J. (2010) Chairperson Australian prudential regulation authority: 'Global regulatory reforms - An update: Introductory remarks'. FINSIA Financial Services Conference, Sydney, 20 October 2010.
    • 55 Masters, B. and Murphy, M. (2010) Analysis: 'Suspense over'. Financial Times, 19 August 2010. See also a subsequent section on spin.
    • 56 King, M. (2010) Banking - From Bagehot to Basel, and back again. at the Second Bagehot Lecture, Buttonwood Gathering, New York, 25 October 2010, at page 6. See also, Liam Halligan, King makes a stand for reform as banks seem intent on forgetting, The Sunday Telegraph, 31 October 2010 where Mervyn King is quoted for the same view in similar terms.
    • 57 King, M. (2010) Banking - From Bagehot to Basel, and back again. at the Second Bagehot Lecture, Buttonwood Gathering, New York, 25 October 2010, at pages 6 and 7.
    • 58 Thomas O'Riordan, D. (2011) Liquidity, leverage and capital under the spotlight of Basel III. JIBFL, 1 April (2011) 4: 201, at page 7.
    • 59 Capital: How much is enough? Banks are having to puff up their capital cushions: (author unattributed in the print edition 12 May 2011: The Economist, www.economist.com/ node18654640.
    • 60 King, M. (2012) Speech given by Sir Mervyn King, Governor of the Bank of England at the Lord Mayor's Banquet for Bankers and Merchants of the City of London, 14 June 2012 at page 7.
    • 61 Jenkins, P. (2011) Citi in bad assets sale as Basel III rules loom. Financial Times, 19 April 2011.
    • 62 Hughes, J. (2010) Stress tests spur bank bond issues. Financial Times, 12 July 2010.
    • 63 Jones, S. (2010) Fund to help banks meet Basel rules. Financial Times, 28 October 2010.
    • 64 Sakoui, A. and Jenkins, P. (2009) Stability concerns over CoCo bonds. Financial Times, 6 November 2009.
    • 65 Sir John Vickers, How to regulate the capital and corporate structures of banks? Speech 22 January 2011, All Souls College, University of Oxford, at page 7. considered separately. O
    • 66 The increase of tier one capital to 10 per cent has been 78
    • 67 Jenkins, P. and Goff, S. (2011) Vickers to insist on bond- 79 H funded buffer for debt. Financial Times, 24 May 2011. See also H. Wilson, Barclays finalises plans for retail split,
    • 68 1G3ooJudnhear2t,011C..A.E. and Lastra, R.M. T(2010) Border
    • 69 Tucker, P. Discussion of Lord TurUner'slecture 'Reformproblems. 1 September (2010) JIEL 13(3): 705-718. ing finance: Are we being radical enough?'. At: Clare Distinguished Lecture in EcAonomics, Cambridge, at page 7 (available B of E website).
    • 70 Tucker, P. Discussion of Lord Turner's lecture 'Reforming finance: Are we being radical enough?'. At: Clare Distinguished Lecture in Economics, Cambridge, at page 7 (available B of E website). See also, R. Jenkins: The capital conundrum: Speech at the Annual Conference of the International Centre for Financial Regulation, Berlin, 19 October 2011, where he supports an increase in bank capital through an increase in bank equity. He concludes at page 4: 'Indeed more equity in the mix may very well be beneficial to bank shareholders as well as to the financial system at large. Instead of fighting it, bankers should be pushing for it'. See also: C. Goodhart, The Vickers Report: An assessment: January (2012) Law and Financial Markets Review 6(1): 32-38. At page 32 he writes that his 'preferred approach' would have been to require 'much more equity capital'.
    • 71 Discussion Paper 09/02 FSA, A Regulatory Response to the Global Banking Crisis, March 2009, paragraph 7.5.
    • 72 Discussion Paper 09/02 FSA, A Regulatory Response to the Global Banking Crisis, March 2009, Paragraph 7.11.
    • 73 Jenkins, P. and Masters, B. (2011) Bank regulators attacked amid push for tougher capital rules. Financial Times, 28 March 2011.
    • 74 Turner, A. (2011) Leverage, maturity transformation and financial stability: Challenges beyond Basel III. Cass Business School, 16 March 2011, at page 5. See also N. Wellink, Rebuilding the financial sector: Speech by Dr N. Wellink President of the Netherlands Bank and Chairman of the Basel Committee on Banking Supervision, at the Colloquium of the Centre for Financial Studies, Frankfurt am Main, 8 December 2010., where he talks about the need for 'higher buffers for SIFIs as compared to Basel III' at page 5 Bis Review 171/2010. See also B. Masters and P. Jenkins, FT Interview with Lord Turner: 'Regulator poised to set tougher capital rules' Financial Times, 22 September 2010. Y Simon Gleeson considers that for 'bail-in' to be a proper tool then it must be available for use where SIFIs are the context of bank groPups,January (2012) Law and Financial involved: Simon Gleeson, Bank resolution and bail-ins in Markets Review 6(1): 61-67.
    • 75 Ojo, M. ssrn.Ocom/abstract 1407197: Risk management by the Basel committee: Evaluating progress made from the Financial CRegulation and Compliance 18(4): 305-315. 1988 Basel accord to recent developments. Journal of
    • 76 Giles, C. and Murphy, M. (2011) IMF calls for banks to pay more to cover risk. Financial Times, 7 April 2011.
    • 7R7Braithwaite, T. (2011) Geithner voices doubts on nature of systemic risks. Financial Times, 14 January 2011. Goff, S. and Jenkins, P. (2011) HSBC chairman calls for 'systemic' list of 80 banks. Financial Times, 7 April 2011. Caruana, J. (2010) Basel III towards a safer financial system. at the 3rd Santander International Banking Conference, Madrid, 15 September 2010.
    • 80 EU Focus 2010, 270, 15-16 (There is no author attributed to this piece).
    • 81 Basel Committee on Banking Supervision: The Basel Committee's response to the financial crisis: report to the G20 October 2010, at page 14.
    • 82 Competition and choice in retail banking: Government Response to the Ninth Report from the Committee: Seventh Special Report of Session 2010-2012 published 12 July 2011: paragraphs 208 and the immediate paragraphs thereafter.
    • 83 HC 1069-i House of Commons Oral Evidence Taken before the Treasury Committee: Independent Commission on Banking, 24 May 2011: Sir John Vickers, Martin Taylor and Bill Winters: Sir John Vickers in relation to Q90 Stewart Hosie: Neither witnesses nor Members have had the opportunity to correct the record.
    • 84 Independent Commission on Banking: Final Report: Recommendations September 2011, at paragraph 2.19.
    • 85 See, in particular, the section on the Independent Commission on Banking in this article discussed subsequently.
    • 86 How to Regulate the Capital and Corporate Structures of Banks? Sir John Vickers: Speech at All Souls College, University of Oxford, 22 January 2011, at page 7.
    • 87 FSB. (2010) Reducing the moral hazard posed by systemically important financial institutions. 20 October 2010: available from www.financialstabilityboard.org.
    • 88 FSB. (2010) Reducing the moral hazard posed by systemically important financial institutions. 20 October 2010: Recommendation 6 at page 3 of the report.
    • 89 Masters, B. and Jenkins, P. (2011) Biggest banks face new capital clampdown. Financial Times, 17 June 2011.
    • 90 Masters, B. (2011) Regulators agree to impose extra capital charge to protect top banks. Financial Times, 27 June 2011.
    • 91 The Lex Column. (2011) Basel dazzle 'em. Financial Times 27 June 2011.
    • 92 Jackson, T. (2011) Basel struggle to put bank capital into perspective. Financial Times, 27 June 2011.
    • 93 Masters, B. and Jenkins, P. (2011) Biggest banks face new capital clampdown. Financial Times, 27 June 2011.
    • 94 September 2011.
    • 95 Paragraph 4.18 of the Independent Commission on Banking Final Report Recommendations, September 2011.
    • 96 Paragraph 4.119 of the Independent Commission on Banking Final Report Recommendations September 2011. Paul Tucker has confirmed the need for SIFIs to have 'additional loss absorbency' FSB issues International Standard for Resolution Regimes: FSB Press Release, 4 November 2011. The FSB's Key Attributes of Effective Resolution Regimes October 2011 contain no proposals or discussion relating to loss absorbency.
    • 97 Paragraph 4.119 of the Independent Commission on Banking Final Report Recommendations, September 2011.
    • 98 Paragraph 4.123 of the Independent CommisRsionon Banking Final Report Recommendations, September 2011. systemically important financial institutions. O20 October
    • 99 FSB. (2010) Reducing the moral hazard posed by 2010 suggests a study on increased loss absorbency to be completed by mid-2011. H See generally: Joosen, B. (2012) Further changes to the T capital requirements directive: CRD IV - Major overhaul of the current European CRD legislation to adopt the section on IdentifiUcationand monitoring of systemically Basel III accord: (Part I). JIBLR 27(2): 45-62, in the important institutions. A See generally: Joosen, B. (2012) Further changes to the capital requirements directive: CRD IV - Major overhaul of the European CRD IV - Major overhaul of the European CRD legislation to adopt the Basel III accord: (Part I). JIBLR 27(2): 45-62, in the section on identification and monitoring of systemically important institutions. See generally: Joosen, B. (2012) Further changes to the capital requirements directive: CRD IV - Major overhaul of the current European CRD legislation to adopt the Basel III accord: (Part I). JIBLR 27(2): 45-62, See also: C. Randell: 'The great British banking experiment: will the restructuring of UK banking show us how to resolve G-SIFIs?' January (2012) Volume 6 Number 1 Law and Financial Markets Review 39-51. Stress testing is discussed in a separate section subsequently.
    • 103 Kay, J. (2010) Banking needs more robust stress tests than these. Financial Times, 28 July 2010.
    • 104 Slovik, P. (2011) Systemically Important Banks and Capital Regulation Challenges OECD Economics Department. Working Papers No 916 ECO/WKP (2011) 85.
    • 105 Testimony of H. Scott: Before the Committee on Financial Services: United States House of Representatives. 16 June 2011: Section IV Systemically Important Financial Institutions: at page 19.
    • 106 In the opinion of Lord Turner: Hosking, P. (2011) Lax lending. The Times, 18 March 2011: 'leaves borrowers vulnerable'.
    • 107 Dr Nicholas Ryder 'Irresponsible lending - The Financial Services Authority strikes back!' Financial Regulation International, 19 January 2011.
    • 108 Goff, S. and Masters, B. (2010) FSA to tighten mortgage controls. Financial Times, 14 July 2010.
    • 109 Rowley, E. (2011) IMF warns on banks masking bad debts. The Telegraph, 7 June 2011.
    • 110 Ryder, N. (2011) Irresponsible lending - The Financial Services Authority strikes back. Financial Regulation International 19 January 2011. Y
    • 111 Masters, B. and Jenkins, P. (2010) Mortgage reforms to focus on lenders. Financial Times, 17 September 2010. excesses. PThe Independent, 19 September 2011.
    • 112 Read, S. (2011) Stricter mortgage rules will end market 113 IMF. (2010) A Fair and Substantial Contribution by the O Financial Sector. Final Report for the G-20, June 2010. There are proposals for a European Union levy on banks: Clevy on banks to create safety net, Financial Times, 25 May These are outlined by N. Tait, Brussels pushes for upfront 2010.
    • 114 IMF. (2010) A Fair and Substantial Contribution by the Financial Sector. Final Report for the G-20, June 2010.
    • 115 HM Treasury. (2010) Bank Levy consultation response: October 2010. The technical details of the Levy are necessarily outside the scope of this article. For a detailed account of the taxation aspects, see K. Cummings, Legislative Comment: 'The bank levy: draft legislation' (2011) B T R 1: 24-33.
    • 116 Jenkins, P., Goff, S. and Parker, G. (2011) Banks criticise Osborne's move to increase balance sheet levy. Financial Times, 9 February 2011.
    • 117 Braithwaite, T. and Kaper, S. (2011) Regulators to unveil stricter rules on mortgages. Financial Times, 29 March 2011.
    • 118 Masters, B. and Jenkins, P. (2011) New risk regulator to assess financial stability. Financial Times, 18 February 2011.
    • 119 Vickers Commission: Interim Report: Consultation on Reform Options April 2011, at page 51.
    • 120 Marcelo, A., Rodriguez, A. and Trucharte, C. (February 2008) Stress tests and their contribution to financial stability. Journal of Banking Regulation 9: 65-81, The increase in data and surveillance is discussed by I. Chiu, Transparency regulation in financial markets - Moving into the surveillance age? EJRR (2011) 3: 305-321.
    • 121 Jenkins, P. (2011) The [European Banking] authority's new chairman is tacking last year's shortcomings. Financial Times 18 March 2011. See also: P. Jenkins, Regulators taking a blinkered approach to stress tests, Financial Times, 15 March 2011. In addition, P. Jenkins and J. Wilson, Bank tests softened despite criticism, Financial Times, 9 March 2011.
    • 122 Jenkins, P. (2010) Doubts resurface on credibility of stress tests. Financial Times, 24 November 2010.
    • 123 Turner, A. (2011) Leverage, maturity transformation and financial stability: Challenges beyond Basel III. Cass Business School, 16 March 2011, at page 5 footnote 4.
    • 124 Munchau, W. (2010) A test cynically calibrated to fix the result. Financial Times, 26 July 2010.
    • 125 Munchau, W. (2010) Europe risks failing the real test on banks. Financial Times, 5 July 2010.
    • 126 Jenkins, P. (2011) Alpha bank scuppers hopes of national bank of Greece merger. Financial Times, 14 March 2011.
    • 127 Masters, B. (2011) Sants calls for powers to expose bank flaws. Financial Times, 19 May 2011.
    • 128 Masters, B. (2011) FSA insists that UK tests will be stricter than continental versions. Financial Times, 18 March 2011.
    • 129 Masters, B. and Jenkins, P. (2010) FT interview with Lord Turner: 'Regulator poised to set tougher capital rules'. Financial Times, 22 September 2010.
    • 130 Jenkins, P. (2011) The [European Banking] authority's new chairman is tackling last year's shortcomings. Financial Times, 18 March 2011.
    • 131 See the approach of the EBA below.
    • 132 The view of Mr Umunna in his question 34 to Paul Tucker: House of Commons Oral Evidence taken before the Treasury Committee on Financial Regulation, 1 March 2011. This is an oral transcript and neither witnesses nor Members have had an opportunity to correct the record.
    • 133 Reece, D. (2011) FSA to assess levels of risk behind big banks' profits. The Sunday Telegraph, 5 June 2011.
    • 134 Haldane, A. (2009) Why banks failed the stress test. 13 February 2009: Speech at the Marcus-Evans Conference on Stress-Testing, 9-10 February 2009.
    • 135 Jenkins, P. (2011) Deadline set for EU governments to detail action on 'failing' banks. Financial Times, 18 March 2011.
    • 136 Jenkins, P. (2010) Bankers concerned over stress test results. Financial Times, 19 July 2010.
    • 137 Masters, B., Murphy, M. and Jenkins, P. (2011) BHanksface deadline for EU-wide stress tests on risk of bond losses. T Financial Times, 24 June 2011.
    • 138 A ninth bank, a German bank that failed the stress test did 'most' lenders have increased their Ucapital buffers and not disclose its result. The EBA is reported as saying that would be able to meet any economic shocks: Barker, A. A Wilson, J. and Murphy, M. (2011) Watchdog moots aid for banks. Financial Times, 31 August 2011.
    • 139 Jenkins, P., Masters, B. and Spiegel, P. (2011) Spain and Italy top results in stress tests. Financial Times, 18 July 2011.
    • 140 Jenkins, P. and Masters, B. (2011) Wave of debt deals set to follow stress tests. Financial Times, 15 July 2011.
    • 141 Jenkins, P. and Masters, B. (2011) Analysis: 'Again under strain'. Financial Times, 8 July 2011.
    • 142 Jenkins, P. and Masters, B. (2011) Bank watchdog sets out to square the circle. Financial Times, 15 March 2011.
    • 143 Jenkins, P. and Masters, B. (2011) European banking regulators look to raise bar for stress tests. Financial Times, 7 March 2011.
    • 144 Scott, H.S. (2010) Reducing systemic risk through the reform of capital regulation. 1 September (2010) JIEL 13(3): 763-778, See also T. Barber and R. Atkins, EU leaders give go-ahead for publication of bank stress tests, Financial Times, 18 June 2010.
    • 145 European Banking Authority 2011 EU-Wide Stress Test Aggregate Report, 15 July 2011.
    • 146 Jenkins, P. (2011) Regulators taking blinkered approach to stress tests. Financial Times, 18 March 2011.
    • 147 Guerrera, F. and Braithwaite, T. (2011) US banks face fresh stress tests before paying higher dividends. Financial Times, 10 January 2011.
    • 148 Jenkins, P. (2010) Stressed but blessed. Financial Times, 26 July 2010. See also M. Murphy, N. Cohen and B. Masters, Basel boost for US banks over new equity, Financial Times 19 August 2010.
    • 149 Scott, H.S. (2010) Reducing systemic risk through the reform of capital regulation. 1 September (2010) JIEL 13(763): 6.
    • 150 Braithwaite, T. (2011) Fed sets US banks toughest stress test. Financial Times 23 November 2011. Banks that failed the stress test which included a Eurozone collapse and a 13 per cent unemployment rate were again to be stopped from declaring dividends or buying back capital from the
    • 151 Braithwaite, T. (2011) Fed YsetsUS banks toughest stress US government.
    • 152 Braithwaite, T. and PAlloway, T. (2012) Fed's stress test test. Financial Times, 23 November 2011. results likely to see US banks double dividends. Financial Times, 12 MOarch2012.
    • 153 By 'Some academics' according to Braithwaite, T. and success. CFinancial Times, 14 March 2012. Alloway, T. (2012) US banks shored up by stress test
    • 154 Reece, D. (2011) FSA to assess levels of risk behind big banks' profits. The Sunday Telegraph, 5 June 2011: 'the Rregulator must act' in the view of Hector Sants.
    • 155 Mustafa, K. (2011) Understanding stress testing. Compliance Monitor 23(10): 19-21, 21 July 2011. Mustafa, K. (2011) Understanding stress testing. Compliance Monitor 23(10): 19-21, 21 July 2011. The IMF working paper accepts, at page 6, that there are 'quite a wide range of approaches': M. Moretti, S. Stolz and M. Swinburne, IMF Working Paper: Stress Testing at the IMF: WP/08/206.
    • 157 See Article 32 paragraph 32 of Regulation (EU) No 1093/ 2010, which established the EBA. Stress Testing in the context of the CRD is discussed by Joosen, B. (2012) Further changes to the capital requirements directive: CRD IV -Major overhaul of the current European CRD legislation to adopt the Basel III accord: (Part 1). JIBR 27(2): 45-62, in the section on Supervisory stress testing.
    • 158 Marcelo, A., Rodriguez, A. and Trucharte, C. (2008) Stress tests and their contribution to financial stability. Journal of Banking Regulation 9: 65-81.
    • 159 Giles, C. (2011) IMF admits wilting under Brown treasury. Financial Times, 11 February 2011.
    • 160 Clayton, N. (2010) Many hands make light work: The tripartite arrangement as part of the legislative reforms to banking legislation in the UK - A spectrum of views from a spectrum of institutions. July 2010 Law and Financial Markets Review 4(4): 366-393, See also: D. Singh, The UK Banking Act 2009, pre-insolvency and early intervention: policy and practice (2011) J B L 2011, 1: 20-42.
    • 161 Masters, B. (2011) King promises 'radical' change to supervision. Financial Times, 2 March 2011.
    • 162 Walker, G.A. (2011) A new approach to financial regulation. Financial Regulation International 19 January 2011. See also C. Tietje and M. Lehmann, The role and prospects of international law in financial regulation and supervision (2010) JIEL 13(3): 663-682, 1 September 2010. 'What is clear, however, is that micro-prudential standards will be changed in such a way as to take into account macro-prudential concerns: more anti-cyclicality shall be obtained by requiring banks to build up buffers of resources during good times, which they can draw on when economic conditions deteriorate', at page 6.
    • 163 Accountability of the Bank of England: Uncorrected Transcript of Oral Evidence: To be published as HC 874-iii House of Commons Oral Evidence Taken Before the Treasury Committee: Accountability of the Bank of England, 20 June 2011. Answer of Professor Lastra to question 258 from Mr Andrew Tyrie chairperson.
    • 164 Oral Evidence of Mervyn King in response to question 14 by Mark Garnier: Taken before the Treasury Committee, 1 March 2011. This is an oral transcript and witnesses and Members of Parliament have not had an opportunity to correct the record.
    • 165 Bailey, A. (2010) Financial reform. Remarks at The Lord Mayor's City Banquet, London, 21 September 2010.
    • 166 MacNeil, I. (2011) Editorial: 'Regulatory reform takes shape'. Law and Financial Markets Review 5(3): 161-163, May 2011.
    • 167 House of Commons Treasury Committee: Financial Regulation: a preliminary consideration of the Government's proposals Seventh Report of Session 2010-2011 Volume 1 Report, together with formal minutes 27 January 2011, page 26 paragraph 64 in answer to Rquestion 798. Jacome and P. Madrid, 'Towards effective Omacroprudential
    • 168 IMF Working Paper WP/11/250 E. Nier, J. Osinski, L. policy frameworks: An assessment of stylized institutional H models' IMF. The report notes at page 9 that a number of countries, post the banking collapse, are integrating T prudential supervision into the Central Bank and are adopting a twin peaks approach. They add 'The United within the central Ubank, chaired by the governor and Kingdom also created a financial policy committee (FPC) including government representation'.
    • 169 This theme Awillbe examined throughout the article.
    • 170 Paul Tucker in answer to question 14 of Mr Umunna: House of Commons Oral Evidence Taken Before the Treasury Committee: Financial Regulation, 1 March 2011. This is an oral transcript and witnesses and Members of Parliament have not had an opportunity to correct the record.
    • 171 Giles, C., Beattie, A. and Braithwaite, T. (2010) G20 backs drive for crackdown on banks. Financial Times, 28 June 2010.
    • 172 The ring-fencing proposals are outside the scope of this article.
    • 173 The lawyer is not identified. T. Young, 'Vickers report: the biggest questions' www.iflr.com/TopicLIstArticle/2898816.
    • 174 Answer of Mr Roberts of the FSA strategic department to question 54 of the minutes of evidence taken before the select committee of the European Union [Sub-Committee A) taken on 2 February 2010: House of Lords: European Union Committee: 10th report of session 2009-2010: The future regulation of derivative markets: is the EU on the right track? Report with evidence published 31 March 2010.
    • 175 As examples Piegiorgio Alessandri, Andrew Haldane and Professor Goodhart: House of Commons: Treasury Committee: Too important to fail-too important to ignore': Ninth Report of Session 2009-2010: Report, together with formal minutes published by the House of Commons 22 March 2010 Volume 1 at page 32.
    • 176 This is the conclusion of the House of Commons Treasury Committee: 'Too important to fail-too important to ignore': Ninth Report of Session 2009-2010: Report, together with formal minutes published by the House of Commons 22 March 2010 Volume 1 at page 33.
    • 177 Masters, B. (2011) Basel chief puts focus on bank's capital. Financial Times, 10 October 2011.
    • 178 Independent Commission on Banking: Final Report Recommendations September 2011, Executive summary: in the section on Financial Stability at page 9. Y
    • 179 Masters, B. (2011) Reveal leverage ratio ahead of rivals, banks told. Financial Times, 2 December 2011. resulting Pfrom an institution's vulnerability due to leverage 180 Defined by article 4 of the CRD Directive as: 'ythe risk or contingent leverage that may require unintended Ocorrective measures to its business plan, including distressed selling of assets which might result in losses or in valuation Cdiscussed in Joosen, B. (2012) Further changes to the adjustments to its remaining assets'. This leverage ratio is capital requirements directive: CRD IV -Major overhaul of the current European CRD legislation to adopt the Basel III accord: (Part 1). JIBLR 27(2): 45-62, in the section on Risk of excessive leverage.
    • 181 Joosen, B. (2012) Further changes to the capital requirements directive: CRD IV - Major overhaul of the current European CRD legislation to adopt the Basel III accord: (Part 1). JIBLR 27(2): 45-62.
    • 182 Young, T. PRA's discretionary regulatory powers criticised, www.iflr.com/Article/2930887.
    • 183 Section 3 of the Draft Financial Services Bill as amended in Public Bill Committee 22 March 2012, which inserts a new section 9(C)(1) into the Bank of England Act 1998.
    • 184 See Section 4 of the Financial Services Act 2012, amending the Bank of England Act 1998 and inserting new Sections into that Act.
    • 185 Paragraph 2.49 of A new approach to financial regulation: Building a stronger system February 2011 Cm 8012. It has been pointed out that the FPC in using macro prudential instruments to regulate banks could cause increased inflation contrary to the remit of the MPC. D. Green: A battle for the levers of power: Will macro-prudential regulation clash with monetary policy? July/August 2011 www.financialworld.co.uk.
    • 186 Fournier, E (2010) 29 July 2010 Market dissects relaxed Basel guidelines, www.iflr.com/TopicListArticle/2640777. There were adjustments made to the definition of tier one capital to take on board concerns of Japanese Banks, R. Evans, Tier-one reprieve for Japanese banks, 29 July 2010. www.iflr.com/TopicListArticle/2640699See also M. Barr and G. Miller, Global Administrative Law: The View from 199 Basel I February (2006) EJIL 17(1): 15-46, where the authors indicate that the Basel Committee have become more open, transparent and open to suggestions from banks.
    • 187 Murphy, M. and Jenkins, P. (2010) Shares bounce as regulators soften rules. Financial Times, 28 July 2010. See also B. Masters and M. Murphy, 'Suspense over' analysis, Financial Times, 19 August 2010. See also P. Jenkins and B. Masters, Banks win battle for limits to Basel III, Financial Times, 25 June 2010. 200
    • 188 Jenkins, P. (2010) Banks lifted by UBS results and plans to tone down Basel rules. Financial Times, 28 July 2010.
    • 189 Masters, B. (2010) Basel breakthrough in drive to tighten rules on global banking. Financial Times, 27 July 2010.
    • 190 Masters, B. (2010) Liquidity rules to squeeze smaller banks on processing of payments. Financial Times, 31 December 203 2010. See also B. Masters, Shake-up set to raise costs of borrowing, Financial Times, 10 September 2010.
    • 191 FT.com editorial comment. (2011) King helps the case for banking reform. Financial Times, 8 March 2011.
    • 192 Birrell, I. (2011) Proof banks don't have to be run the Gordon Gekko way. Evening Standard, 19 April 2011. 204
    • 193 Turner, A., Lord (2011) K Ahmed 'Turner: Banks face more rules'. The Sunday Telegraph, 30 January 2011. 205
    • 194 Jenkins, P. (2011) Bankers see hope on EU loophole. Financial Times, 19 April 2011. See also the section on Spin.
    • 195 Parker, G., Giles, C. and Jenkins, P. (2011) Osborne stands 206 by banking review. Financial Times, 7 March 2011. See also Editorial Comment by Ian MacNeil Law and Financial Markets Review January 2011. See also E. Fournier, Basel leniency could harm UK banks, 29 July 2010. www.iflr .com/TopicListArticle/2640692. The point that a level playing field could be jeopardised is also discussed briefly in financial regulation and supervision (2010) JIEL 13(683), Oat R.H. Weber, Multilayered governance in international 207 page 8. Stuart Gulliver, the chief executive of HSBC, is reported as saying that it could move its head office Hout of 208 Britain and sever its ties with this country if the ringfencing proposals of Vickers undermTineits profits, 209 P. Hosking, HSBC may pull out of Britain if it fails tough
    • 196 Banks' long-term lending ability U'penalised' by Basel III, new profit test, The Times, 18 May 2012. Financial Times 3 May 2011. (The author is not specifically A attributed in the section by Daniel Schafer). See also E. Rowley, Basel III squeezes bank loans, Daily Telegraph, 7 January 2011.
    • 197 Jenkins, P. and Goff, S. (2011) New bank rules hit HSBC outlook. Financial Times, 1 March 2011.
    • 198 Slovik, P. and Coumede, B. OECD Economics Depart- 210 ment. Working Papers, 14 February 2011. This type of view is contested by the Bank of International Settlements that considers that any reduction in GDP would be much more modest: S. Bair (chairperson of the Federal Deposit Insurance Corporation), The road to safer banks runs through Basel, Financial Times, 24 August 2010. A. Onetto, Project finance in LATAM: Trends and impact of BASEL III (2012) 1 JIBFL 41 is of the view that increase in capital requirements means increased costs of lending in project finance. Reforming finance: Bare-Knuckle in Basel: The task of sorting out banking is far from finished: 27 May 2010: The Economist (author not attributed in the print edition): www.economist.com/node16216472See also Basel 3: The banks battle back: A behind-the-scenes brawl over new capital and liquidity rules: 27 May 2010: The Economist (author not attributed in the print edition) www.economist.com/node16231434, where it is suggested by two large banks that their profits could be reduced by 16 and 37 per cent, respectively. Wilson, J. and Wiesmann, G. (2011) Visibility needed: Analysis. Financial Times, 6 April 2011.
    • 201 Jenkins, P., Goff, S. and Murphy, M. (2011) Flight delayed. Financial Times, 15 April 2011.
    • 211 Norton, J.J. Bank Regulation and Supervision in the 1990's. Lloyd's of London Press, London 1991, Chapter 5: P.C. Hayward, Prospects for international co-operation by bank supervisors. Peter Hayward was a member of the Secretariat of the Basel Committee on Bank Supervision at that time.
    • 212 Trachtman, J.P. (2010) The international law of financial crisis: Spillovers, subsidiarity, fragmentation and cooperation. 1 September (2010) JIEL 13(719), at footnote 23 and the reports on this point cited thereafter.
    • 213 Capital Punishment: Measuring the price of regulation, The Economist 10 September 2011 (author not attributed) www.economist.com/node/2158687.
    • 214 See the Testimony of H. Scott, Before the Committee on Financial Services United States House of Representatives 16 June 2011. Section C: Differential impact at page 17.
    • 215 Masters, B. and Grant, J. (2010) 'Shadow boxes' in the analysis section. Financial Times, 3 February 2011.
    • 216 Scott, H.S. (2010) Reducing systemic risk through the reform of capital regulation. 1 September (2010) JIEL 13(763): 5.
    • 217 Langevoort, D.C. (2010) Global securities regulation after the financial crisis. 1 September (2010) JIEL 13(799): 3.
    • 218 Jackson, T. (2011) Regulators and banks caught in game of cat and mouse. Financial Times, 31 January 2011.
    • 219 A view echoed by Lord Turner: Kamal Ahmed 'Turner: banks face more rules', The Sunday Telegraph, 30 January 2011.
    • 220 Masters, B. and Grant, J. (2011) Shadow boxes' in the analysis section. Financial Times, 3 February 2011.
    • 221 Vickers Commission: Independent Commission on Banking Interim Report Consultation on Reform Options April 2011, at pages 56 and 57. This is the view also Rofthe IMF: IMF Survey Magazine: Global Banking Rules 'New November 2010. The point is made that Oshadow banks Rules Will Curb Risks in U.S. and European Banks', 3 could seek to move to less regulated jurisdictions.
    • 222 Jenkins, P. and Masters, B. (2011) HShadow banks to face global scrutiny, says Turner. Financial Times, 17 November T 2011. Lord Turner is quoted as saying: 'Although a lot of the problems came from the shadow banking system, most institutions'. A Turner ULeverage, Maturity Transformation of our response so far has been focused on the banking and Financial Stability: Challenges Beyond Basel III: at page 9: 'we Amust not focus exclusively on specific institutions, such as banks, but on total financial systems and markets'.
    • 223 FSB: Shadow banking: Scoping the issues: A background note of the Financial Stability Board, 12 April 2011.
    • 224 FSB: Shadow banking: Scoping the issues: A background note of the Financial Stability Board, 12 April 2011 at pages 4 and 5: Section 1.2.1: The shadow banking system as a systemic risk concern.
    • 225 FSB: Shadow banking: Scoping the issues: A background note of the Financial Stability Board, 12 April 2011 at page 7: Section 2.2: Improving the monitoring framework for the shadow banking system.
    • 226 HC 1069-i: House of Commons Oral Evidence: Taken before The Treasury Committee: Independent Commission on Banking: 24 May 2011, Sir John Vickers, Martin Taylor and Bill Winters: Response of Martin Taylor to Q99 of Stewart Hosie. Neither witnesses nor Members have had the opportunity to correct the record.
    • 227 Jenkins, P. and Masters, B. (2010) The money moves on' analysis. 15 September 2010, where Simon Gleeson is quoted: 'It's a third more expensive in regulatory capital terms to do business with a bank than with a non-bank. This is a powerful incentive to use non-banks as counterparties'.
    • 228 IMF Working Paper: Monetary and Capital Markets Department J. Chow and J. Surti, Making Banks Safer: Can Volcker and Vickers do it, WP/11/236, at page 22.
    • 229 FSB: Shadow Banking: Scoping the Issues: A Background Note of the Financial Stability Board, 12 April 2011, at page 5 in section 1.2.2: The shadow banking system as a regulatory arbitrage concern. See also: the European Commission: Green Paper: Shadow Banking: Brussels, 19 March 2012 COM (2012) 102 Final, where the EU indicate, at page 9, Paragraph 6.2: Enlarging the scope of current prudential regulation to shadow banking activities, that there is a need to make 'future regulatory arbitrage more difficult'. Y
    • 230 The other proposals, in particular in relation to ring fencing, are outside the scope of this article. See generally banking: PInterim findings and comment. Law and Financial Walker, G. (2011) The independent commission on Markets Review 5(3): 213-223.
    • 231 OHC1069 -i: House of Commons Oral Evidence Taken before the Treasury Committee: Independent Commission Cand Bill Winters: In response to Question 90 by Stewart on Banking: 24 May 2011, Sir John Vickers, Martin Taylor Hosie, Sir John Vickers replied: 'At least 10% is in relation to risk-weighted assets'. Neither witnesses nor Members have had the opportunity to correct the record.
    • 232 Independent Commission on Banking: Interim Report: Consultation Reform Options: Executive Summary, April 2011.
    • 233 Independent Commission on Banking: Interim Report Publication 11th April 2011 Opening Remarks Sir John Vickers. This approach is confirmed by Paragraph 2.28 of the Independent Commission on Banking Final Report Recommendations September 2011: 'large ring-fenced banks should maintain equity of at least 10% of RWAs'.
    • 234 The Vickers proposed 10 per cent capital for retail banks 'would be possible in my proposal' according to Michel Barnier, the European Union's internal market commissioner Masters, B. and Jenkins, P. (2011) Barnier seeks to soothe UK over banks. Financial Times, 22 July 2011. See also L. Becker, CRD 4 limits minimum capital requirement flexibility, 20 July 2011 www.iflr.com/Article/2868901.
    • 235 External MPC Unit: Discussion Paper 31 revised and expanded version: Optimal bank capital: David Miles, Jing Yang and Giberto Marcheggiano April 2011 expanded version from an earlier version published in January 2011.
    • 236 Although this paragraph was contained in an earlier part of the report: External MPC Unit: Discussion Paper 31 cited above.
    • 237 At page 4: External MPC Unit: Discussion Paper 31 cited above.
    • 239 Jenkins, R. (2011) Why banks must think carefully before they shrink their assets. The Times, 14 December 2011 published also on the B of E website after he was appointed a member of the FPC.
    • 240 House of Commons Oral Evidence Taken before the Treasury Committee: Independent Commission on Banking, 24May 2011: Neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings.
    • 241 Sir John Vickers: In response to Question 41 of Mr HMudie: House of Commons Oral Evidence Taken Before The T Treasury Committee: Independent Commission on Banking 24 May 2011: Sir John Vickers, Martin Taylor and Bill opportunity to correct the record. Utranscript The is not yet Winters. Neither witnesses nor Members have had the an approved formal record of these proceedings.
    • 242 See Questions 43 and 44 of AMrMudie and in response to question 44 Sir John Vickers replied 'Yes': House of Commons Oral Evidence Taken before The Treasury Committee: Independent Commission on Banking 24 May 2011: Sir John Vickers, Martin Taylor and Bill Winters: neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings.
    • 243 Turner, A. (2010) We need new rules to keep bankers honest. Financial Times 8 December 2010. See also Roger McCormick, Towards a more sustainable financial system: the regulators, the banks and civil society. Law and Financial Markets Law Review, Volume 5, Number 2 March 2011 129-138 (10). In answer to question 25 of John Thurso, House of Commons Oral Evidence Taken before the Treasury Committee: Independent Commission on Banking: 24 May 2011: Bill Winters indicates that a good culture within an organisation is 'helpful' and a bad culture 'extremely damaging'. Neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings. The importance of the general culture in banks is highlighted by Bill Withers in the quote at the end of the article.
    • 244 Bill Winters in response to question 71 from Jesse Norman: House of Commons Oral Evidence Taken before the Treasury Committee: Independent Commission on Banking, 24 May 2011: Sir John Vickers, Martin Taylor and Bill Winters: neither witnesses nor Members have had the opportunity to correct the record. The transcript is not yet an approved formal record of these proceedings. This article has focused on the capital and liquidity matters.
    • 245 Paragraph 4.39 of the Independent Commission on Banking Final Report Recommendations September 2011. See generally Goodhart, C.A.E. (2012) The Vickers report: An assessment. Law and Financial Markets Review 6(1): 32-38, (7), where the author supports greater the keeping of greater equity on the part of banks rather than
    • 246 See previously. Y ring-fencing. ing Final Report RePcommendations September 2011.
    • 247 Paragraph 2.20 of the Independent Commission on Bank-
    • 248 Paragraph 4.43 of the Independent Commission on Banking Final ReOportRecommendations September 2011.
    • 249 Paragraph 4.44 of the Independent Commission on Bank-
    • 250 ParagCraph4.32 of the Independent Commission on ing Final Report Recommendations September 2011. Banking Final Report Recommendations September 2011. The Independent Commission referred to the Revidence of Admati and Hellwig.
    • 251 See Box 4.6, at page 97, of the Independent Commission on Banking Final Report Recommendations September 2011. Lord Myners (former City Minister in the Labour Government) speech in the House of Lords: www .blogs.ft.com/westminster/2011/09/lord-myners-condemsthe-vickers-report/.
    • 253 Jenkins, P., Atkins, R. and Spiegel, P. (2012) Europe's banks face 9% capital rule. Financial Times, 12 October 2012.
    • 254 Masters, B. (2011) Globetrotting regulators to ensure Basel III compliance. Financial Times, 17 November 2011.
    • 255 Barker, A. and Masters, B. (2012) Paris and Berlin quiz Basel rules. Financial Times, 23 January 2012.
    • 256 Barker, A. (2011) Analysis: Financial regulation: 'Barnier vs the Brits'. Financial Times, 9 November 2011. Andrew Bailey: Keynote Speech to BSA Annual Conference, 5 May 2011 (available B of E website) accepted, at page 11, the desire of building societies for the European capital directive to be compatible with Basel III but that matters were at 'an early stage of negotiation, so outcome is by no means certain'. The battle between a maximum harmonisation approach favoured by the European Commission and more flexibility for national regulators continues: A. Barker, UK fights on over bank rules, Financial Times, 2 April 2012.
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