Banking crisis easing according to central bank

It has been reported that the Bank of England in the UK has claimed that the crisis that has hit the banking industry has started to ease off, although it does not deny that the system remains highly vulnerable and could be easily hit by disruption again.

The central bank recently released its Financial Stability Report, and the data in the report suggested that the losses that had resulted from the financial crisis had come to around £10 trillion.

However, whilst the figure may seem high officials have said that it was a vast improvement on the predictions for March, which were far higher than this. Having confirmed that the banking crisis is starting the ease the Bank of England has also called for tougher regulations for banks and financial institutions to try and prevent a repeat of the crisis that has been tearing through the financial industry over the past year and a half.

Whilst much of the focus over the past eighteen months has been centred around how to get the banking and financial industry out of the mess that it was in, the focus now seems to have shifted onto how future problems can be minimised through more stringent regulation.

The deputy governor of the Bank of England, Paul Tucker, stated recently: “The policy debate now underway matters enormously if we are to achieve a more stable financial system in the future.”

There appears to be differences of opinion between the Bank of England, the Treasury, and the Financial Services Authority with regards to how regulation should be set to prevent a future financial meldown, with Mervyn King, the governor of the central bank, wanting the Bank of England to have a more pivotal role in any future regulation.

Tags: finance, vast improvement, figure, bank of england, paul tucker