Banks

Banks are at the heart of our financial systems and critical to the working of our economies. If you want to know more have a look around this page where we will outline how banks work and how they are being reformed in a way that everyone can understand. We will be adding to this section in the coming months - so do not forget to check back soon.

The importance of banks to the economic system is, however, why they are also at the heart of the financial crisis. Across the spectrum there is agreement that we need a major overhaul of our banks and banking rules if we are to have a sustainable, stable financial system and economy. Financeorwatch has some clear ideas on what needs to be done for the public interest to regain sovereignty over the banks.

Recently…

Our most recent publication is our short Policy Brief "Structural reform to refocus banks on the real economy". Before this, we have published a longer report on Banking Union, and why it won’t work unless large universal banks are restructured. Here are the key points in one page.

Our multimedia dossier "Understanding Finance #1: Splitting megabanks?" gives you a non-technical overview on the issue of bank separation and explains Financeorwatch's position on this crucial issue.

There is also a note on bank separation, designed to be read by politicians and newcomers to the subject alike, and a technical factsheet on bank separation for journalists.

In May 2013, we took the occasion of a hearing at the Bundestag on the application of the Capital Requirement Directive in Germany to make a general assessment of CRD IV - the application of Basel 3 recommendations in European law.

Recent videos include two former regulators explaining why too-big-to-fail is wrong and debunking some of the myths that banks use to avoid regulation.

We’ve made a webinar to explain what universal banks do and to discuss possible laws to separate deposit taking banks from investment banks.

And we have a cartoon which illustrates the problems of imbalance caused by banks which are too-big-to-fail #tbtf

 Cartoon tbtf

The “dossiers”

Although bank reforms are all connected they are separated into different pieces of legislation:

  • Bank Recovery and Resolution – tries to introduce a way for national authorities to deal with failing banks, other than simply bailing them out, without harming depositors and payment systems.
  • Bank Separation – should try to separate those bits of banks that must be saved from those that could fail like normal businesses.
  • CRD4/CRR/Basel III - requiring banks to fund themselves with more capital, so they are less likely to need public money when things go wrong.
  • Banking Union – contemplates European mechanisms to supervise banks better and help them to fail without causing excessive damage to the economy.

Blog

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Video

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Webinar

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Cartoons

Financeorwatch cartoon Financeorwatch cartoon Financeorwatch cartoon

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