A senior official at the Bank of England has warned of the risk of bowing to pressure from lobbyists in the banking industry who want to see a relaxation of rules introduced since the banking crisis.
Paul Fisher, one of the most senior regulators at the Bank, said the new regime – which will force banks to ringfence their high street operations from any investment banking operations – needed be tested during another crisis before any watering down took place.
“We probably won’t know for sure just how effective the new regime is until we reach another crisis.
Meanwhile, we need to guard against the reforms being rolled back as a result of a period without crisis.
Let’s complete the programme, give it time to work, be supportive of growth wherever we can, and be open-minded about change,” Fisher told an audience in London.
“But let’s also be cautious about the siren voices of financial self-interest that were partly responsible for luring us on the rocks in the first place,” he added.
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