SPECULATIVE BANKING
- Session: 2009-10
- Date tabled: 05.01.2010
- Primary sponsor:
- Sponsors:
That this House notes the enormous damage that the international banking crisis has done to jobs, businesses and public finances and to some of the world's poorest people; recognises the substantial and continuing resources provided by taxpayers to support banks; acknowledges that an important part of this crisis was caused by a number of traditional deposit taking retail banks becoming involved either directly or indirectly with speculative, casino-style, investment banking; welcomes the support of all political parties for continuing to provide a government guarantee for retail deposits held in banks; further notes that when banks are systemically important it is the taxpayer rather than the shareholder who carries the ultimate risk; supports much stronger regulation of banks to help prevent such a crisis in the future; recognises that, given constant financial innovation, regulation on its own will never be completely successful in always preventing massive losses on speculative `casino-type' investment banking; further acknowledges that in a bank that combines speculative investment banking and traditional retail banking, massive losses on the speculative side would threaten its retail deposits thus necessitating taxpayers to rescue such a combined bank; and therefore calls on the Government in its forthcoming banking legislation to separate speculative casino banking from traditional retail banking and, as well as leading by example, to encourage a similar approach internationally.