Reform needed to avoid new financial crisis, says Brown
Gordon Brown has warned that Britain risks "sleepwalking" into another financial crisis if the G20 fails to create an early warning system and clamp down on the shadow banking sector.
Speaking at the Bank of England's independence conference in London yesterday, the former prime minister said another crash could be inevitable without critical reforms and better regulation. "My belief is that governments will go sleepwalking into the next crisis unless we deliver a more effective G20, a full early warning system and better regulation of the shadow banking system," he said.
The former Labour leader, who also served as chancellor under the Tony Blair administration, singled out the risks of the so-called shadow banking system, referring to financial services firms or banking activities that fall outside of standard regulation.
Mr Brown said the banking sector could not shoulder the burden of reform on its own.