Local view for "http://purl.org/linkedpolitics/eu/plenary/2010-10-06-Speech-3-986"
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"en.20101006.15.3-986"2
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"The financial and economic crisis of recent years has dispelled illusions that the banks know their own risk best and are able to determine security requirements on their own. The profound ignorance of some of the people in charge of banks, the paramount importance given to sales plans and the ignoring of risk factors, accompanied by the passivity of the system of financial supervision, are the fundamental sins of the banking sector which were the direct catalyst of the world recession.
Basel II has not proved very effective as a crisis prevention mechanism. In these circumstances, it is essential, as quickly as possible, to create a new code of standards – Basel III – which will no longer include the optimistic assumption of the ability of banks to regulate themselves.
Raising capital requirements will certainly contribute to an increase in the security of the banking sector by a growth in liquidity. However, such measures also carry the risk of transferring costs to the clients of banks – a growth in credit prices and other financial services – to the detriment of the economy. It is necessary, therefore, to guarantee suitable protective frameworks which would prevent us from being affected by this unwelcome effect, or at least keep it to a minimum. On the other hand, however, we must be aware that financial security also costs. The question is, how much are we willing to pay for it?"@en1
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