Robert Jenkins 1 - Financial Industry 2
Monday 28 November 2011 - by Regulation Mutters
A senior member of the Bank of England's new Financial Policy Committee set the cat among the pigeons last week when he complained that bank sector lobbying is "dishonest".
In a well argued letter to the newspaper, Lewis claimed that Jenkins' comments make for "an entertaining read" but bore little resemblance to reality.
"Contrary to Mr Jenkins' claim, the leading European banks that are members of the Association for Financial Markets in Europe are neither campaigning against regulation per se nor dragging their feet on implementation.
"We fully accept the need for banks to hold a much higher quantity and quality of capital. Indeed, many banks are already meeting the required standards ahead of the regulatory timetable."
"Mr Jenkins also betrays a fundamental misunderstanding of banks' funding and risk management strategies, and on their relationship with the wider economy.
"In warning about reduced returns and constrained capacity to lend, bank managements are not crying wolf, they are stating the obvious: that where banks have to hold higher risk-weighted assets and more equity per RWA, the cost of credit will go up, impacting credit demand and growth in the real economy."
Over to you, Bob.
- Send your musings, rumours and links to The Mutterer at firstname.lastname@example.org
|Login||Register||Most read||Most commented|
Will markets in 2012 have a tougher time than 2011?