UK government backs plans to jail reckless bankers

9 July 2013

Most of the recommendations produced by the Parliamentary Commission for Banking Standards will be supported by the UK government.

The main suggestion will be a new criminal offence of reckless conduct by bankers, including those at the very top, which will come with the possibility of a jail term.

Banker bonuses, which has been a major issue for many years, will now be deferred by up to ten years and may be repayable if a bank needs to be bailed out.

However, the coalition stopped short on agreeing to tougher limits on the risk-taking practices of banks.

The commission issued a report last month that urged the government to produce much tougher leverage ratios for banks, limiting the total amount of loans and investments an institution can make relative to the amount of capital it holds.

However, chancellor George Osborne has decided to stick to the lower level that was agreed internationally.

By Tony Aynsley

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