Posts Tagged ‘economic reform’

The World’s Economies Try To Prevent Another Crisis

Monday, June 28th, 2010

Banks might have to operate under tighter rules in order to avoid another global financial slump.

  • Some of the world’s largest economies are designing major regulations for banks that would ensure they are prepared to absorb large financial losses and avoid another financial meltdown.
  • The negotiations, called Basel III, require banks to have secure and defined assets that they can hold against short- and long-term financial losses. But after a meeting on Sunday it seems that it could be years before these regulations are put into place.
  • Banks are reluctant to adopt these regulations. They argue that they could slow the global recovery from the recent economic crises.

Facts & Figures

  • If Basel III is put into place, the economic growth of the United States and Japan could fall 3% by 2015

Best Quote

“The quality and amount of capital in the banking system must be significantly higher to improve loss absorbency and resiliency.”  - Mr. Draghi, Governor, Bank of Italy.