Barclays boss calls for 'consistent' regulation of banks

25th October 2010, Comments 0 comments

Barclays' incoming chief executive Bob Diamond on Monday called for consistent regulation of the world's banking sector to help safeguard economic recovery, in an address to business leaders here.

"Economic growth must now be the primary goal, and economic growth depends upon a healthy and competent banking system," said Diamond, an American who will take over from Briton John Varley in March 2011.

"But if banks are to make their full contribution to economic growth they need one thing above all -- they need regulation that is consistent on a global basis."

Diamond was speaking at the annual conference of the Confederation of British Industry (CBI), which is Britain's biggest employers' organisation.

His comments come just weeks before new European Union rules on banking sector pay take effect.

And earlier this year, the British government set up the Independent Commission on Banking to study whether big banks should be broken up, and their investment and retail arms separated, following the global financial crisis. The commission will report its findings in September 2011.

"Banks are working hard to restore trust. We accept that we made mistakes, just as regulators and policy makers have accepted their mistakes," Diamond added on Monday.

"And that's important because without that acceptance we cannot move on and work together to face the challenges ahead of -- a challenge which is to create a safe and sound financial system, one that also fosters economic growth and job creation."

He added: "Strong banks ... certainly do not want to go through a similar situation again. And no bank should ever, ever receive taxpayers' money.

"It's true that the banking industry made mistakes. Since the start of the crisis, we've been operating with more capital, with higher quality capital, with less leverage and with stronger liquidity."

© 2010 AFP

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