The U.K. bankers and regulators charged with reviewing Libor in the wake of regulatory probes are resisting calls to overhaul the rate because structural changes risk invalidating trillions of dollars of contracts.
Banks should be forced to reveal pay policies that may encourage irresponsible risk taking, global regulators said in rules aimed at pressuring lenders to curb compensation and take back bonuses if performance is poor.
The way banks sell structured products similar to those at the center of the U.S. case against Goldman Sachs Group Inc. is being reviewed by the U.K. financial regulator, according to lawyers who advise the lenders.
European Union lawyers gave the U.K. victories in fights over financial regulation that will boost the country’s standing in a power struggle over the future of banks and securities trading in the 28-nation bloc.
Most large U.S. banks that weathered the financial crisis by strengthening the level and quality of their capital should be able to pass future stress tests, said a researcher at the Federal Reserve Bank of San Francisco.
The Basel Committee on Banking Supervision is considering extra capital requirements of as much as 3.5 percentage points that the largest banks may face if they grow bigger, according to two people familiar with the talks.
In the five months after the U.S. published results of its 2009 bank stress tests, the Standard & Poor’s 500 Financials Index rose 25 percent. Five months after the European Union released its version, the Bloomberg Europe Banks and Financial Services Index is down 4 percent.