- Title: SWITZERLAND: U.S. say new banking regulations are in the pipeline
- Date: 31st January 2010
- Summary: DAVOS, SWITZERLAND (JANUARY 30, 2010) (REUTERS) (CONTAINS FLASH PHOTOGRAPHY) CEOS, BANKERS AND OTHER PARTICIPANTS WALKING OUT OF MEETING ON BANKING REGULATION JOURNALISTS WAITING BANKER WALKING OUT OF ROOM JOURNALISTS CHAIRMAN OF US HOUSE FINANCIAL SERVICES COMMITTEE BARNEY FRANK WALKING OUT OF MEETING JOURNALISTS (SOUNDBITE) (English) CHAIRMAN OF US HOUSE FINANCIAL SERVICES COMMITTEE BARNEY FRANK SAYING: (Question: "Do you think that bankers got the message today?") "Oh, I think they do, and frankly it doesn't make any difference whether they did or not. They aren't in charge of this. The political leadership certainly in the US is going to go ahead with tough, sensible regulation. We made very clear and I think they accepted the distinction, it's not up to them as to whether or not we do it. Once we have decided that we have to improve capital requirements etc., I want knowledgeable people to help in with the details. But it doesn't make any difference to us if people understood. I believe they understand it but I don't much care." FRANKS TALKING TO JOURNALISTS (SOUNDBITE) (English) CHAIRMAN OF US HOUSE FINANCIAL SERVICES COMMITTEE BARNEY FRANK SAYING: "I think they all understand that regulation is coming, it's going to be regulation. One of the points they made correct was don't just regulate banks, you have to regulate investment houses, we agree to all of that. So, as I said, this is going forward, this form of regulation, and the importance of this is that we know what each other is doing. No one country is going to veto any other country. I do find as an American involved in this, yeah, I like to know what others are doing. We do want to have some general understanding of what they're doing, but we're going to go ahead." ECONOMIST NOURIEL ROUBINI TALKING TO DELEGATE AFTER MEETING
- Embargoed: 15th February 2010 12:00
- Keywords:
- Location: Switzerland
- Country: Switzerland
- Topics: Economic News
- Reuters ID: LVAAFKSSQWITLZNDWUA0O64UTA7
- Story Text: The world's top bankers meet to discuss their response on how to fight back against a global push for tougher financial regulation, while the Chairman of America's House Financial Services Committee says the U.S. will push ahead with tough new rules regardless of what the bankers decide.
Barney Frank, the powerful chairman of the U.S. House Financial Services Committee, said on Saturday (January 30) that America was determined to introduce tough new banking regulations to avoid a repeat of the recent financial crisis.
Frank was speaking as top executives from leading U.S. and European banks held behind-the-scenes talks in Davos, Switzerland to discuss their response on how to fight back against a global push for tougher financial regulation.
The annual forum in the Swiss mountain resort has reverberated with U.S. President Barack Obama's plans to curb the activities of major banks, particularly betting in financial markets with their own money, sparking a fierce debate on the necessary overhaul and the risks of excessive correction.
Frank said the reality of the regulation to come was sinking in for the world's top CEOs and that they had 'got the message':
"Oh I think they do, and frankly it doesn't make any difference whether they did or not. They aren't in charge of this. The political leadership certainly in the US is going to go ahead with tough, sensible regulation. We made very clear and I think they accepted the distinction, it's not up to them as to whether or not we do it. Once we have decided that we have to improve capital requirements etc, I want knowledgeable people to help in with the details. But it doesn't make any difference to us if people understood. I believe they understand it but I don't much care," he said.
Regulators and policy makers, meanwhile, appeared to have struck some common ground at the World Economic Forum, agreeing on the need to ensure changes to the rulebook -- from bankers' pay to lenders' activities -- were global, and not unilateral.
But Frank said the U.S. would move ahead with its plans whether or not other countries followed.
"So, as I said, this is going forward, this form of regulation, and the importance of this is that we know what each other is doing. No one country is going to veto any other country. I do find as an American involved in this, yeah, I like to know what others are doing. We do want to have some general understanding of what they're doing, but we're going to go ahead," he said.
The Financial Times reported on Saturday that some key banks, including Deutsche Bank, had moved toward support of a global bank wind-down fund to help cover the costs of bank failures. But not all bankers agree.
During the financiers' talks, Wall Street's largest banks and some European investment banks argued for a common front against politicians who are calling for much tougher measures to regulate the industry in the wake of the financial crisis.
But they did not win-over the heads of some commercial banks and even some European peers, who believe the industry needs to be more conciliatory, sources familiar with the talks said.
Top industry figures including Barclays President Bob Diamond and Deutsche Bank Chief Executive Josef Ackermann have taken the stage in Davos to warn policy makers against unilateral action on regulation that would threaten fragile political consensus on new rules within the G20.
Some economists, however, have said it may suit banks to spin out the negotiations on an agreed set of rules in the hope of delaying and watering down changes as the economy improves. - Copyright Holder: REUTERS
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