No ‘one shot silver bullet' exists to solve banking's problems, FSA chairman Adair Turner said today.
The "too big to fail" banks issue needs a multi-pronged attack to cut interconnectedness, narrow banking, and by standardise the way large cross-border groups are treated, Turner says. But controversy remains over the issue of narrowing banking and what to do about the risks created by cross-border operations. ‘Narrow bank' proposals seek to divorce utility banking from casino banking. Lord Turner argues there should be a distinction between commercial banks and proprietary trading, which could be achieved by strict capital requirements and the use of distinct resolution and recove...
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