Banks in the UK should have to hold a minimum of 20 per cent in capital to make sure they can resist any future shocks, a Bank of England official believes.
Robert Jenkins, a member of the institution's Financial Policy Committee, feels this could help restore confidence in lenders and trust between companies and regulatory bodies in the aftermath of the economic crisis.
During a speech delivered at the Worshipful Company of Actuaries at Haberdasher's Hall, London, last night (10 July), Mr Jenkins called for capital requirements to be raised by more than double, saying this would mean banks would enjoy more freedom from regulatory constraints.
"Let me suggest a deal ... how about a moratorium on all new regulation followed by a review and rollback of the rulebook?" he suggested.
The BoE official went on to insist that banking rules are not currently "too tough", as has been suggested by some in the industry.
By Gary Cooper