Global banks will not be in a position where they have to rely on taxpayer-funded bailouts again in the future, a new report has indicated.
Published yesterday (7 June) by the Institute of International Finance (IIF), the study revealed that lenders are well on the way to establishing their "living wills", which will formally outline exactly how firms would be saved without such assistance.
However, the IIF noted that national regulatory bodies need to become more heavily involved in the process of dealing with cross-border banking clean-up operations if the industry is to recover fully.
Douglas Flint, chairman of the body and HSBC, explained that public confidence in banks will be restored when it becomes clear that companies can be put through an "internationally co-ordinated process to resolve their insolvency or illiquidity" while not relying on bailouts.
"We believe that we are now moving towards a situation where these two conditions can be met," he added.
By Claire Archer