Belfast Telegraph

UK Website Of The Year

Bank failure protections are not yet in place: expert

By Sam Lister

Published 12/02/2016

The UK will not become part of an EU banking union aimed at making bailouts a thing of the past, insists Sir Jon Cunliffe
The UK will not become part of an EU banking union aimed at making bailouts a thing of the past, insists Sir Jon Cunliffe

Protections put in place to deal with the failure of a major bank are "not there yet", a deputy governor at the Bank of England has said.

Sir Jon Cunliffe said the powers and institutions are in place to cope with a collapsing bank but the resources are not.

The UK will not become part of an EU banking union aimed at making bailouts a thing of the past, he added.

Sir Jon, who is responsible for financial stability at the central bank, told the EU Financial Affairs Sub-Committee the system was coming along but was not quite in place yet.

"In terms of sufficiency to deal with the failure of a major cross-border bank - I'm talking about the European Union as a whole and the UK - we are well advanced generally down that agenda but we are not there yet," he added.

"Although we have the powers and the institutions to do that building up of the loss absorbency, the loss absorbing resources you could use in a resolution, that's going to happen over four years."

The eurozone is at present moving towards a system of common rules in order to prevent a banking crisis.

Belfast Telegraph

Your Comments

COMMENT RULES: Comments that are judged to be defamatory, abusive or in bad taste are not acceptable and contributors who consistently fall below certain criteria will be permanently blacklisted. The moderator will not enter into debate with individual contributors and the moderator’s decision is final. It is Belfast Telegraph policy to close comments on court cases, tribunals and active legal investigations. We may also close comments on articles which are being targeted for abuse. Problems with commenting? customercare@belfasttelegraph.co.uk

Read More

From Belfast Telegraph