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Bank rule fears `misplaced`: Carney
OTTAWA -- The coming Group of 20 reforms to global banking rules should pose no threat to the economic recovery, Bank of Canada governor Mark Carney said Thursday, arguing fears of their impact are "misplaced."
"Some are concerned that the implementation of these reforms could be damaging to the economic recovery. This apprehension is misplaced," the governor said in a speech to a securities conference in Montreal.
His remarks emerged just hours after the Institute of International Financial, a bank lobby group, warned that a string of regulatory reforms affecting the banking sector could cut 3% off global GDP over the next five years and cost roughly 10 million jobs.
Mr. Carney said the G20 leaders` summit in Toronto this month should "harden" the resolve to strike an agreement on banking reforms, which would require banks to hold more and better capital on their balance sheets, and face tighter leverage limits. The goal is to strike a deal in time for the November G20 leaders summit to be held in Seoul.
Introduction of these changes are scheduled to happen by the end of 2012, although Mr. Carney indicated implementation would be phased-in or done gradually. Some countries could adopt the rule changes ahead of others based on the strength of their financial system and economy, as was discussed at last weekend`s G20 gathering of finance and central bank officials in Busan, South Korea.
When all is said and done, Mr. Carney said the final proposals, developed by the so-called Basel Committee, "will make the global system look more like Canada`s," which had more stringent bank capital requirements compared to its peers.
Read the full article here.
OTTAWA -- The coming Group of 20 reforms to global banking rules should pose no threat to the economic recovery, Bank of Canada governor Mark Carney said Thursday, arguing fears of their impact are "misplaced."
"Some are concerned that the implementation of these reforms could be damaging to the economic recovery. This apprehension is misplaced," the governor said in a speech to a securities conference in Montreal.
His remarks emerged just hours after the Institute of International Financial, a bank lobby group, warned that a string of regulatory reforms affecting the banking sector could cut 3% off global GDP over the next five years and cost roughly 10 million jobs.
Mr. Carney said the G20 leaders` summit in Toronto this month should "harden" the resolve to strike an agreement on banking reforms, which would require banks to hold more and better capital on their balance sheets, and face tighter leverage limits. The goal is to strike a deal in time for the November G20 leaders summit to be held in Seoul.
Introduction of these changes are scheduled to happen by the end of 2012, although Mr. Carney indicated implementation would be phased-in or done gradually. Some countries could adopt the rule changes ahead of others based on the strength of their financial system and economy, as was discussed at last weekend`s G20 gathering of finance and central bank officials in Busan, South Korea.
When all is said and done, Mr. Carney said the final proposals, developed by the so-called Basel Committee, "will make the global system look more like Canada`s," which had more stringent bank capital requirements compared to its peers.
Read the full article here.