The assault continues. At least that is how banks see it — and understandably so.
Last week’s EU-commissioned Liikanen review into the structure of Europe’s banks piled another 153 pages of regulatory reform proposals on top of everything that has come before — Basel III, CRD4, Vickers, Volcker, Dodd-Frank.
Five years after the financial crisis began, it is still too early to feel sorry for the banks that helped cause it. For all the complicity of politicians, regulators, investors and customers, the crisis could not have happened without the banks themselves, and reforming them was always a priority. But as the layers of regulatory reform mount, it is well worth highlighting the inadequacies of that process. In the case of Liikanen — and its central idea of ringfencing banks’ trading businesses — there are at least two shortcomings.
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