Wednesday, June 18, 2014

The Archbishop of Canterbury has warned that the impetus for reforming the banking system is fading, even though taxpayers risk having to bail out the biggest banks – six years after the financial crisis.

“The elephant in the room is that banks are still too big to fail,” Justin Welby said in a speech to the New City Agenda group at the House of Lords on Tuesday. “It is going to take some time to fix this and I hope it will stay front and centre of people’s minds.”

Mr Welby, who was an outspoken member of the parliamentary commission on banking standards, was asked by a JPMorgan Chase banker in the audience if the wave of banking regulation since the crisis had removed the risk of a taxpayer bailout.

The archbishop resisted this idea. “If JPMorgan had to go into insolvency, are we seriously saying it would not cause a systemic crisis? Do we really think the US government would say: ‘No, we are not going to put a penny into this’?”

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