Andy Haldane - Executive Director of Financial Stability, Bank of England
Policymakers need to take action to tackle the growing problem of "arms races" in the British financial system.
That is the opinion of Andrew Haldane, executive director for financial stability at the Bank of England (BoE), who believes there are some deep-seated issues in the sector that need to be addressed sooner rather than later.
During a speech delivered at the Institute for New Economic Thinking in Berlin yesterday (24 April), Mr Haldane - who joined the BoE in 1989 and is also a member of the Financial Policy Committee - called on officials to crackdown on various issues.
For instance, the official said that performance gauges in banking, such as executive compensation, increased significantly before the onset of the recession as financiers competed with each other for the best talent.
This, coupled with technological advances that have made trading much easier and quicker and the tendency of investors to seek out safety rather than returns, has created a "financial arms race".
"Policy needs to have a macro-prudential, as distinct from micro-prudential, perspective," he commented.
By Asim Shah