18
Mar
FSA proposes banking changes
A range of new rules and regulations for the banking industry have
been proposed by the Financial Services Authority (FSA), which may
help prevent a repeat of the credit crunch.
The review of global banking regulations by FSA chairman Lord
Turner included recommendations that financial institutions should
have larger amounts and a better quality of capital to back their
transactions, while liquidity should also be regulated more
tightly.
In its response to the review, the Building Societies Association
(BSA) stated: "It is appropriate that the FSA should be focusing on
liquidity and capital requirements and we urge the FSA to
concentrate its efforts on those areas of greatest systemic
risk."
The BSA also said the FSA was right to have "identified the
drawbacks" of regulating mortgage products.
Such a view was echoed by the Council of Mortgage Lenders, which
stated it is looking forward to the FSA's review of mortgage
regulation being published in September.
It commented that this may provide an opportunity to produce a
regulatory framework to suit both lenders and consumers.
