Prudential Regulation Authority chief executive Andrew Bailey says the regulator will not rest until it has tackled the problem of so-called ‘too big to fail’ institutions so banks can start weaning themselves off public money.
Speaking at the Lansons Communications Future of Financial Services conference, Bailey said public scrutiny of banks has intensified in the wake of the financial crisis.
He said certain elements of the public’s interest in banks, such as their role in supporting the economy and their standards of conduct, are “enduring”.
But he added: “There is a third element, which should not be enduring, which is the dependence of the banking system on public money. That is the one we want to get rid of, and it is as much in the interests of the banks as it is in ours that that should go.
“Nobody should underestimate the difficulty of this whole question of too big to fail. I am firmly of the view that we cannot rest comfortably until we have cracked this, but it will be very difficult.”
Philip J Milton & Company managing director Philip Milton says: “The public stakes in the banks should be looked on as a strategic investment, which should be sold when the banks are stabilised. Today’s prices are not the price at which to be privatising the banks again.”