Sponsored Links
A definite resolution to the global crisis depends on banks regaining financial health and public confidence on the basis of sustainable and welfare enhancing business models, Gertrude Tumpel-Gugerell, an executive board member of the European Central Bank said Monday.
"Not all banks have been equally affected by the crisis, nor have they been equally responsible for it", she said in a speech at Bocconi University in Milan. The main players to blame were international investment banks that moved away from traditional retail banking towards more "modern" methods, the policymaker noted.
She said for a sustainable bank model, it was important that the structure of a bank's liabilities was appropriate with its liabilities. She noted that banks had been excessively leveraged in relation to the risks they were taking. Moreover, banks depended on non-deposit liabilities and ignored deposits as a safe source of funding.
Tumpel-Gugerell said credit risk transfer instruments should not be blamed for the crisis and noted that those instruments generating real economic value would survive the crisis, although at much lower volumes.
Meanwhile, the policymaker noted that launching a leverage ratio for banks would curb the bank's excessive balance sheet growth. Further, raising quality, consistency and transparency, maintaining a framework for counter cyclical capital buffers, along with establishing global standards for funding liquidity would all be useful to improve the resiliency of the banking system.
0 komentar:
Post a Comment