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The Financial Times reports that European bankers on Tuesday warned that excessive regulation in response to the global financial crisis would endanger growth in the real economy, although some international officials insisted on tougher rules, and an end to taxpayer-funded bank bail-outs, these remaining essential for recovery.
Regulators are drafting tough rules that will force banks to hold far more capital and lessen the need for the kind of public rescues seen during the credit crunch.
Bankers said the new rules spearheaded by the G20 group of leading countries also need better co-ordination and timing to avoid a patchwork of implementation emerging.
Jacques de Larosière, the former French central bank governor who chaired a “high-level” group charged with suggesting ways to improve supervision in the European Union, urged that his set of proposals must not be watered down. “It strikes the right balance and must not be weakened,” he declaimed at a Frankfurt conference.
FT’s Press release