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White paper: Darling shackles big banks

Chancellor Alistair Darling is to impose enhanced prudential regulation and stronger capital requirements on large and complex financial organisations.

“Systemically significant” firms will be subject to more regulation including higher capital requirements with the FSA determining the level of capital by working out the potential cost as well as the likelihood of failure of each institution.

The paper says: “The capital requirements in place for systemically significant institutions would need to be sufficient to change incentives of banks to over-indulge in risky activities throughout the economic cycle.

“This should encourage them to reduce or at least better understand the riskier activities they undertake (for example, proprietary trading) and reduce the moral hazard problem by removing the incentive for firms to become systemically significant.”


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Europe: banking on a recovery

Neptune video: Europe — banking on a recovery

Arguing that the eurozone crisis is over, watch Rob Burnett, head of European equities at Neptune, discuss the sectors that he’s investing in to harness the recovery. 

In the video, Burnett addresses the following: 

• The primary drivers of the eurozone’s economic recovery
• The turnaround in individual countries’ current accounts
• Sectors best positioned to harness the recovery, without offering undue exposure to risk

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