uk bank capital requirements
- Thread starter nightyard
- Start date
1066 Country
in today's world of a FIAT (debt) monetary system, the assets a bank can hold is as little as 10% to cover potential issues.
there is a formula that is used to work out the CAR (capital adequacy ratio)...
it's something like tier 1 capital + tier 2 capital divided by risk weighted assets.
Capital adequacy ratio should ensure the bank's capacity to meet liabilities and other risks such as credit risk, operational risk and prevent runs etc.
obviously this went a bit wrong in the UK...
IMO, the Central banks, FIAT debt monetary system and fractional reserve banking are some of the worst things used in history to enslave people, and most don't even understand or know about it...
there is a formula that is used to work out the CAR (capital adequacy ratio)...
it's something like tier 1 capital + tier 2 capital divided by risk weighted assets.
Capital adequacy ratio should ensure the bank's capacity to meet liabilities and other risks such as credit risk, operational risk and prevent runs etc.
obviously this went a bit wrong in the UK...
IMO, the Central banks, FIAT debt monetary system and fractional reserve banking are some of the worst things used in history to enslave people, and most don't even understand or know about it...
nightyard said:writing an essay for uni.
anyone in the know got an opinion on how much capital UK banks should hold?
I'm collecting research right now to form my own ideas on how much I believe they should hold etc and I'd be interested to know peoples views on this matter.
Could be the first instance of Z4 Forum featuring in a university bibliography
nightyard said:
We only have the Big 5 plus the National Bank that dominate Cdn banking and our system is widely held as the most efficient and safest in the world. If you want to point the UK system in a positive direction that's where I'd be looking for ideas. 8)
I have shares in 4 of 'em...
Jembo said:
Like 20th January, got a tax exam to revise for too which is on the 11th January :roll:
The goal posts are forever changing, Basel iii is just a stepping stone.
Adamski said:
That'd be helpful to hear all views on the subject as I'll have to build up an argument in the essay with multiple aspects discussed.
why not post a pov and see what people think?
Just to give you an alternative pov to think about having been working with UK, European and Aussi banks for the last few years.
Sure folks hate the UK banks and measures have to be seen to be taken, however the higher we set the Capital Requirements to prevent perceived future events (and more we break up, regulate and control the banks), the less competitive ours become in a global world. Doesn't take much to move yet another industry out of the UK and to more friendly environments. Irony is that whatever we set the levels at we don't know if it will cover the next big roller coaster. At the moment it's a moving goal and setting the level is like steering a supertanker by looking over the stern to see where we were recently.
The UK banks are one of the remaining pillars of our economy, love or loath 'em.
Not arguing with mcbee as the Canadian banks are strong, but forget Canada, Australia and a few others for this essay. They operate in isolated markets and have very different factors at play.
Sure folks hate the UK banks and measures have to be seen to be taken, however the higher we set the Capital Requirements to prevent perceived future events (and more we break up, regulate and control the banks), the less competitive ours become in a global world. Doesn't take much to move yet another industry out of the UK and to more friendly environments. Irony is that whatever we set the levels at we don't know if it will cover the next big roller coaster. At the moment it's a moving goal and setting the level is like steering a supertanker by looking over the stern to see where we were recently.
The UK banks are one of the remaining pillars of our economy, love or loath 'em.
Not arguing with mcbee as the Canadian banks are strong, but forget Canada, Australia and a few others for this essay. They operate in isolated markets and have very different factors at play.
cj10jeeper said:
this the balancing act my essay is going to discuss
any other aspects you can think of?
definitely appreciate your input as you've hit on some of the major things I have to delve into.
I'll post the results of the assignment when I've handed it in and get a mark back in a month or so :lol:
nightyard said:cj10jeeper said:
this the balancing act my essay is going to discuss
any other aspects you can think of?
definitely appreciate your input as you've hit on some of the major things I have to delve into.
I'll post the results of the assignment when I've handed it in and get a mark back in a month or so :lol:
I'd add that the current requirements are a hybrid of different countries needs, requirements and political agendas, so the end result is unlikely to be right for anyone and least of all the banks.
For the UK I'd be looking at wider measures, but on an individual bank basis controlled under the new FCA and PRA
Splitting retail banking off from corporate and keeping it ring fenced
Stop splitting banks up such as Lloyds with 652 branches becoming TSB. It just makes us less competitive on a global scale, but does sod all to really change anything locally.
Outlawing the ability to have departments that can in effect gamble, hedge, etc. beyond the amount they have available to invest or transact with.
Focussing banks on what they should be doing (lending, collecting, payment transactions, currency movement, etc.) and less on playing with financial toys.
Allow executives to make any salary the banks wish, so they are market competitive, but tie it to longer term result, not boom and bust deals.
Just my 2p worth.
Can I suggest once you have an outline plan (just bullet points of where you're headed) post it here and some folks will no doubt comment.
Off to Ireland in 2 weeks to fix a broken bank, so should be fun
cj10jeeper said:nightyard said:cj10jeeper said:
this the balancing act my essay is going to discuss
any other aspects you can think of?
definitely appreciate your input as you've hit on some of the major things I have to delve into.
I'll post the results of the assignment when I've handed it in and get a mark back in a month or so :lol:
I'd add that the current requirements are a hybrid of different countries needs, requirements and political agendas, so the end result is unlikely to be right for anyone and least of all the banks.
For the UK I'd be looking at wider measures, but on an individual bank basis controlled under the new FCA and PRA
Splitting retail banking off from corporate and keeping it ring fenced
Stop splitting banks up such as Lloyds with 652 branches becoming TSB. It just makes us less competitive on a global scale, but does sod all to really change anything locally.
Outlawing the ability to have departments that can in effect gamble, hedge, etc. beyond the amount they have available to invest or transact with.
Focussing banks on what they should be doing (lending, collecting, payment transactions, currency movement, etc.) and less on playing with financial toys.
Allow executives to make any salary the banks wish, so they are market competitive, but tie it to longer term result, not boom and bust deals.
Just my 2p worth.
Can I suggest once you have an outline plan (just bullet points of where you're headed) post it here and some folks will no doubt comment.
Off to Ireland in 2 weeks to fix a broken bank, so should be fun
I'll get a plan together on tuesday (wish it was sooner but gf comes back tomorrow
)I'd def spend the time with the GF rather than an essay.
Perhaps best I don't tell my wife that...
Perhaps best I don't tell my wife that...