![Risk.net](https://www.risk.net/sites/default/files/styles/print_logo/public/2018-09/print-logo.png?itok=1TpHrpuP)
UK chancellor warns bankers off a return to excess
Bankers who return to excessive ways will be 'brought back to earth', warns Alistair Darling
LONDON - The UK Chancellor of the Exchequer, Alistair Darling, has warned bankers in an interview with The Independent newspaper of the dangers of returning to their old ways of excessive risk-taking.
Worried by signs the excessive culture was returning to the City this week, amid reports large bonuses continue to be paid, Darling warned it would be disastrous if bankers were to return to business as usual. In an interview with the newspaper, he said: "There are people who are too complacent in my view," said Darling. "They need to be brought back to earth."
Some banks are still operating only because they have been rescued by taxpayers, he added.
"If they go back to the way they were - to business as usual - without asking themselves over and over again what they are doing, that would be disastrous for them and the rest of the world," he said.
"As the economy begins to recover, people must not drop their guard but strengthen their guard to make sure they don't repeat the mistakes of the past.
"Similarly, the regulators must keep a close eye on what is happening and be vigilant about the risks. It is very important people don't get the idea it is all over, that they don't need to bother."
A new white paper being issued by the government this week sets out plans to retain the UK's tripartite regulatory system, but give more power to the three bodies to do their jobs effectively. The Bank of England is expected to be given a central role in preventing systemic risk, while the FSA will be told to take a more proactive approach to preventing bonuses that reward short-term profits.
Darling is expected to reject Bank of England governor Mervyn King's call to split up the investment and retail arms of banks, but to outline plans to make it easier to see the split between the two functions.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@risk.net or view our subscription options here: http://subscriptions.risk.net/subscribe
You are currently unable to print this content. Please contact info@risk.net to find out more.
You are currently unable to copy this content. Please contact info@risk.net to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@risk.net
More on Regulation
Vendors lack silver bullet for FRTB’s fund-linked issue
EU and UK legislators tried to ease capital charge by leaning on vendors, but problems persist
Does Basel’s internal loss multiplier add up?
As US agencies mull capital reforms, one regulator questions past losses as an indicator of future op risk
US Treasury official calls for SLR relief during market stress
Under Secretary Liang also urges scrutiny of “artificial incentives” for Treasury futures in 40-Act rules
US banks seek to open vendors’ black box on green data
Inaugural Fed climate scenario analysis flags lack of transparency around third-party models
Why FRTB models are on the edge of extinction
With only four banks known to be applying to use internal models for market risk, the fate of advanced modelling looks precarious
Reframing the Fed’s discount window
Funding window incentives and collateralised credit lines could transform bank liquidity in a crisis, argues Bill Nelson
Attention shifts to US, UK after European Union postpones FRTB
Risk Live: Global timeline still unclear, with banks hoping lawmakers will use delay to soften rules
Go your own way: departures pose new challenges for CFTC
Loss of Democratic majority would impede chairman’s ambitions for regulatory agenda
Most read
- Harvesting the FX skew premium
- How steepener trades burned hedge funds, and what happened next
- House of cards? The $3 trillion (non-systemic) real estate risk