Belfast Telegraph

Bank failure protections are not yet in place: expert

By Sam Lister

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