Financial innovation delivers 'minimal' value - Turner

Speaking at The Economist's City lecture, Lord Turner outlined a number of reforms needed in the banking system to prevent future financial crises. He delivered a damning verdict on the 'originate and distribute' model of financing, where lenders packaged up loans to be sold on to investors, effectively keeping their liabilities off their balance sheet. The model has failed to deliver economic benefits in many cases, he says, while creating a number of risks that increased the dangers of financial instability. He believes this business model does have a role to play in the future, but...