US President Barack Obama was scheduled to announce reforms on Wednesday aimed at averting any repeat of the banking crisis that is still driving up unemployment around the world nearly two years after it struck.
British Chancellor of the Exchequer Alistair Darling was also set to demand a change in banking management yesterday.
The US government has been discussing for six months how best to tighten bank and market regulation in response to the crisis, which was triggered by increasingly risky investment particularly in US home loans during a long-running credit boom.
Obama said on Tuesday that a single regulator would oversee big banks. The smaller banks will remain under the supervision of, among others, the Federal Deposit Insurance Corp, which insures bank and thrift deposits, he said.
“What we do have under our proposal is that for tier-one institutions, the big institutions, who if they fail — require us to shore them up — for those folks, they are going to be under a single regulatory body,” Obama said in an interview with financial news television network CNBC.
“There is going to be streamlining, consolidation ... so that you don’t find people falling through the gaps,” Obama told reporters on Tuesday. “Whether it’s on the consumer protection side, the investor protection side, the systemic risks ... It’s going to be a much more effectively integrated system than previously.”
A senior US official told reporters the plan would also close one bank regulator, the Office of Thrift Supervision, and put the Federal Reserve in charge of monitoring big-picture economic risks.
While belief that the worst is past has propelled global stocks around 40 percent up from their March nadir, investors have begun to seek firmer evidence that a real upturn is in sight.
“Overall, the risk of a continued sharp contraction in output in the near term had receded somewhat,” the Bank of England said, explaining why it voted this month to keep interest rates at a record low of 0.5 percent and maintain its efforts to pump money into the economy by buying debt.
However, “even if developments over the month had been positive, the increase in confidence apparent in some financial market indicators and some household and corporate sector surveys remained fragile,” the bank said in minutes published yesterday.
Meanwhile, Britian’s financial chief Darling told BBC radio that bank executives’ lack of judgment was to blame for the depth of the financial crisis.
He acknowledged that banking regulations needed to be improved, but put the onus firmly on bank boardrooms to avoid a repeat of the current crisis.
“I am going to make the point very forcibly that the first line of defense is in the bank boardrooms themselves,” Darling said ahead of his main annual speech to the financial sector. “It is quite obvious that if you look at what has happened over the last few years, as more and more products became more sophisticated, more complex, quite simply too many people just did not understand what was happening and they didn’t understand the risks to which they were becoming exposed.
CHAOS: Iranians took to the streets playing celebratory music after reports of Khamenei’s death on Saturday, while mourners also gathered in Tehran yesterday Iranian Supreme Leader Ayatollah Ali Khamenei was killed in a major attack on Iran launched by Israel and the US, throwing the future of the Islamic republic into doubt and raising the risk of regional instability. Iranian state television and the state-run IRNA news agency announced the 86-year-old’s death early yesterday. US President Donald Trump said it gave Iranians their “greatest chance” to “take back” their country. The announcements came after a joint US and Israeli aerial bombardment that targeted Iranian military and governmental sites. Trump said the “heavy and pinpoint bombing” would continue through the week or as long
An Emirates flight from Dubai arrived at Taiwan Taoyuan International Airport yesterday afternoon, the first service of the airline since the US and Israel launched strikes against Iran on Saturday. Flight EK366 took off from the United Arab Emirates (UAE) at 3:51am yesterday and landed at 4:02pm before taxiing to the airport’s D6 gate at Terminal 2 at 4:08pm, data from the airport and FlightAware, a global flight tracking site, showed. Of the 501 passengers on the flight, 275 were Taiwanese, including 96 group tour travelers, the data showed. Tourism Administration Deputy Director-General Huang He-ting (黃荷婷) greeted Taiwanese passengers at the airport and
State-run CPC Corp, Taiwan (CPC, 台灣中油) yesterday said that it had confirmed on Saturday night with its liquefied natural gas (LNG) and crude oil suppliers that shipments are proceeding as scheduled and that domestic supplies remain unaffected. The CPC yesterday announced the gasoline and diesel prices will rise by NT$0.2 and NT$0.4 per liter, respectively, starting Monday, citing Middle East tensions and blizzards in the eastern United States. CPC also iterated it has been reducing the proportion of crude oil imports from the Middle East and diversifying its supply sources in the past few years in response to geopolitical risks, expanding
STRAIT OF HORMUZ: In the case of a prolonged blockade by Iran, Taiwan would look to sources of LNG outside the Middle East, including Australia and the US Taiwan would not have to ration power due to a shortage of natural gas, Minister of Economic Affairs Kung Ming-hsin (龔明鑫) said yesterday, after reports that the Strait of Hormuz was closed amid the conflict in the Middle East. The government has secured liquefied natural gas (LNG) supplies for this month and contingency measures are in place if the conflict extends into next month, Kung told lawmakers. Saying that 25 percent of Taiwan’s natural gas supplies are from Qatar, Chinese Nationalist Party (KMT) caucus secretary-general Lin Pei-hsiang (林沛祥) asked about the situation in light of the conflict. There would be “no problems” with
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