Too-big-to-fail largely phased out: Hockey
Federal Treasurer, Joe Hockey, has reconfirmed Australia's commitment to ending the ‘too-big-to-fail' mentality around financial institutions, but said large-scale failures were unlikely given the way the system has evolved.
Addressing the G20 summit in Brisbane, Hockey confirmed the Financial Stability Board had pitched additional capital sources for banks to draw on if they face potential failure.
However, he said the global financial system is markedly different to how it was in the lead up to the financial crisis of 2008.
"As a result of policy action our financial institutions are more resilient and less likely to wreak damage on our economies and citizens through costly failures," he said.
"They have more and better capital, and have more defences against liquidity pressures."
The treasurer said reducing the risks around derivative products and their transparency is also firmly on the agenda of the G20.
AUTHOR
Staff Writer
Recommended for you
The Financial Services and Credit Panel has made its latest ruling over a case involving an incorrect Statement of Advice.
With Fortnum Private Wealth and Professional Financial Services now unified under the Entireti umbrella company, CEO Neil Younger has detailed to Money Management the firm’s new direction and future expansion.
The FAAA has suggested looking offshore for overseas financial advisers to ease the adviser shortage, but are employers willing to take on the burden of workplace visas?
There may be a huge influx of alternatives coming to the market, but timing and access difficulties mean advisers can easily end up disappointed with their selection, according to Morningstar global CIO Dan Kemp.
