Arab Today, arab today us uk shareholders \now to pay if bank fails\
Last Updated : GMT 18:32:28
Arab Today, arab today
Arab Today, arab today

US, UK shareholders \'now to pay if bank fails\'

Arab Today, arab today

Arab Today, arab today US, UK shareholders \'now to pay if bank fails\'

London - AFP

British and US banking regulators proposed on Monday a joint strategy to ensure that the bankruptcy of big banks won\'t spark a chain reaction of contagion throughout markets. The two bodies, acting on behalf of the two largest financial centres in the world, stressed that under the proposals, shareholders and not taxpayers would bear the full costs, and top managers would be sacked. At the Bank of England, the deputy governor for financial stability Paul Tucker said: \"The \'too big to fail\' problem simply must be cured. We believe it can be and that this joint paper provides evidence of the serious progress that is being made.\" The British and US authorities said in a joint statement that the financial crisis had \"driven home the importance of an orderly resolution process for globally active, systemically important, financial institutions\" which have foundered. They said that their solutions, which would target the parent of any finance house in trouble, \"have been designed to enable large and complex cross-border firms to be resolved without threatening financial stability and without putting public funds at risk.\" They said they had borne in mind work by the G20-backed Financial Stability Board on principles for dealing with failed financial institutions. There has been widespread criticism of the way in which Lehman Brothers investment bank was closed down, triggering a massive crisis of confidence, and that in the disruption that followed some shareholders did not carry the full brunt of the costs and some managers held on to their boardroom jobs. In the United States and in Europe, governments had to use taxpayers\' funds to provide guarantees or new capital to financial institutions in trouble. Creditors lost money but most depositors were protected. The objective is to minimise the dangers of so-called \"systemic risk\", when a sudden loss of confidence threatens to trigger chaos throughout the financial system as nearly occurred in 2007. The strategy by the Bank of England and the US Federal Deposit Insurance Corporation is a response to the traumas and lessons of the financial crisis which followed. The statement said that the British part of the strategy was intended to fit with the powers provided by the UK Banking Act of 2009 \"and in anticipation of the further powers that will be provided by the European Union Recovery and Resolution Directive.\" Britain, a member of the European Union but not of the eurozone, is campaigning hard on another front which has a bearing on bank resolution: this is progress towards an EU banking union, built initially around the 17 eurozone members with banking supervision vested in the European Central Bank. Britain is concerned that this could become a back door way for eurozone and EU authorities to interfere in regulation of the financial sector in Britain in a way which would damage British interests. The statement said that the proposals were based on a \"top-down\" strategy for dealing with financial firms in severe difficulty, whereby a single authority would apply its powers \"to the top of a financial group, that is, at the parent company level\" and across borders. In the United States the measures would work in the context of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. \"Such a strategy would apply a single receivership at the top-tier holding company, assign losses to shareholders and unsecured creditors of the holding company, and transfer sound operating subsidiaries to a new solvent entity or entities,\" said the statement. Both the US and British approaches would \"ensure continuity of all critical services performed by the operating firm(s), thereby reducing risks to financial stability.\" The joint statement said: \"The unsecured debt holders can expect that their claims would be written down to reflect any losses that shareholders cannot cover, with some converted partly into equity in order to provide sufficient capital.\" Subsidiaries which were viable would be kept open and operating, \"thereby limiting contagion effects and crossborder complications.\" The statement also made clear that action to deal with financial firms in trouble \"would be accompanied by the replacement of culpable senior management.\" The full document is available at: http://www.bankofengland.co.uk/publications/Documents/news/2012/nr156.pdf.

Name *

E-mail *

Comment Title*

Comment *

: Characters Left

Mandatory *

Terms of use

Publishing Terms: Not to offend the author, or to persons or sanctities or attacking religions or divine self. And stay away from sectarian and racial incitement and insults.

I agree with the Terms of Use

Security Code*

Arab Today, arab today us uk shareholders \now to pay if bank fails\ Arab Today, arab today us uk shareholders \now to pay if bank fails\

 



Arab Today, arab today
Arab Today, arab today Fadi Kataya explains secrets of  Nancy Ajram's newlook
Arab Today, arab today Messi visit will contribute in tourism

GMT 14:04 2017 Friday ,24 February

Messi visit will contribute in tourism
Arab Today, arab today Expresses Algerian history by woody figures

GMT 13:26 2017 Friday ,24 February

Expresses Algerian history by woody figures
Arab Today, arab today Mental conflict endures

GMT 07:36 2017 Friday ,24 February

Mental conflict endures
View News in Arabic - Business: مصارف
Arab Today, arab today
Arab Today, arab today
Arab Today, arab today Reading therapy relieves mental disorders

GMT 15:39 2017 Friday ,24 February

Reading therapy relieves mental disorders
Arab Today, arab today UK appoints 1st Scotland Yard chief in 188 years

GMT 05:14 2017 Thursday ,23 February

UK appoints 1st Scotland Yard chief in 188 years
Arab Today, arab today Ex-yoga missionary unleashes rage

GMT 12:16 2017 Thursday ,23 February

Ex-yoga missionary unleashes rage
Arab Today, arab today Pluto's unruly moons

GMT 06:31 2015 Thursday ,04 June

Pluto's unruly moons
Arab Today, arab today Tesla back into red but revenue grows

GMT 07:27 2017 Thursday ,23 February

Tesla back into red but revenue grows
Arab Today, arab today Nissan enhances sales in most markets

GMT 14:08 2017 Monday ,20 February

Nissan enhances sales in most markets
Arab Today, arab today Wafaa Amer is happy for Sherihan’s return

GMT 07:36 2017 Wednesday ,22 February

Wafaa Amer is happy for Sherihan’s return
Arab Today, arab today Milan laughs while Rome cries

GMT 10:28 2017 Wednesday ,22 February

Milan laughs while Rome cries

GMT 05:19 2017 Tuesday ,21 February

Salma Rashid happy for 'A Whisper of Love'

GMT 12:35 2017 Tuesday ,21 February

63-Year-Old Woman Delivers Baby

GMT 22:42 2017 Thursday ,23 February

Nasima Gamei revives heritage in jewelries

GMT 15:53 2017 Tuesday ,21 February

Small ponds have outsized impact

GMT 20:33 2017 Friday ,17 February

To release new antiques collection

GMT 07:51 2017 Wednesday ,22 February

Mom's immune system accepts babies

GMT 09:59 2017 Monday ,20 February

Tourism shows signs of recovery

GMT 13:12 2015 Saturday ,09 May

Sheikh Sultan opens Sharjah Centre

GMT 20:02 2017 Tuesday ,21 February

Nohan Seyam designs beautiful accessories
Arab Today, arab today
Arab Today, arab today
 
 Arab Today Facebook,arab today facebook  Arab Today Twitter,arab today twitter Arab Today Rss,arab today rss  Arab Today Youtube,arab today youtube  Arab Today Youtube,arab today youtube
arabstoday arabstoday arabstoday arabstoday
arabstoday arabstoday arabstoday
arabstoday
بناية النخيل - رأس النبع _ خلف السفارة الفرنسية _بيروت - لبنان
arabstoday, Arabstoday, Arabstoday