London - Arabstoday
The Financial Secretary to the Treasury said Britain's new macro prudential supervisor "needs to be mirrored in Europe" to avert future crises. Speaking at a regulatory event in London, Mr Hoban said – in a reference to Sir Mervyn King's speech that a central bank's role is to "take away the punchbowl as the party is in full swing" – that the Financial Policy Committee's (FPC) job would be "taking away the punchbowl" from overheated markets and act as an early warning to risks building up. "We also believe macro prudential supervision needs to be mirrored in Europe. It's vital all national regulators have both macro prudential and resolution tools to address emerging risks," said Mr Hoban. The FPC is due later this week to publish a list of powers it wants to carry out its responsibilities, expected to include the ability to cap home loans and set capital requirements for individual institutions. "The FPC will be taking decisions that have significant economic implications," Mr Hoban said. "We, like our international peers, are in the early stages of understanding how these tools would work. Our knowledge will only increase through shared experience."