BOE Governor Mervyn King will still have three appearances at the MPC meetings before Mark Carney takes the chair.
To summarise today’s session:
- key concern is failing the ‘too big to fail’ issue
- failure would mean only the US and China could afford to have large banking sectors
- greater powers on leverage are needed, leverage rations of 10-20 needed in the long run
- expressed concern that RBS’s problems had dragged on and finalisation needed up to one more year
- the banks’ bonus cap issue raises concerns of pushing pay structures higher; expressed the need (like Osborne) for the ability to claw back for losses
- the delays in resolving PPI issues was damaging banks’ capital
