Richard Lambert gives speech opposing the breaking up of banks

Richard Lambert gives speech opposing the breaking up of banks; Lambert speech (cont'd) SOT - The regulators also have much to do / Here in the UK, the new Financial Policy Committee will have a critically important part to play, taking action when its needed to avoid credit booms and busts and spotting new risks well before they become explosive / It's important that it should not be run just by a bunch of technocrats: it will also need people on board with the imagination to see when the Emperor has no clothes / On the international front, the priority must be to create a system in which failing banks cannot look to the taxpayer for support, and where debt holders will face losses once equity investors are wiped out / The sooner the banks know what they are in for in the way of new regulations the better / As the Chancellor has said, clouds of uncertainty can lead to a hoarding of excessive capital instead of more lending to business / But introducing changes too quickly could damage economic recovery, if banks were forced to change the structure of their balance sheets in a hurry / They need to know where they are going, but they need time to get there / Another priority for the regulators must be to find ways of reviving the securitisation market as a source of loan funding in the UK / One point here is that the regulatory regime as it works at present puts the UK at a disadvantage compared with the EU and the US / At a time when bank lending to support the economy is so important, the authorities need to do everything in their power to build a level playing field here / And finally, what do the bankers have to do? / The UK banks have come a long way in the past twelve months / Among other things, they have accepted the arguments for smarter supervision at every level / They acknowledge that trading activities should be curtailed when they are not being undertaken for clients, that stronger capital buffers need to be built over time, and that consistent rule...