Bank reforms to protect taxpayers
The plans are also expected to lead to a reduction in UK economic output of £600 million to £1.4 billion, according to the Government. But it believes these costs will be far outweighed by the benefit of avoiding another financial crisis and mammoth bank bail-out, which has cost the UK £140 billion.
Mark Hoban, Financial Secretary to the Treasury, said the plans were "ambitious in scale but balanced in impact". In a statement to Parliament, he said the Government was "determined to take action to deliver a stable banking sector that underpins, not undermines, economic growth".
He added reforms should ensure that "investors reap rewards when banks do well but take the pain when banks fail". "Investors and creditors, not taxpayers, should bear the costs," he said.
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