The deputy governor of the Bank of England, Paul
Tucker, has set out ten recommendations aimed at moving the
shadow banking debate towards a concrete policy agenda.
The proposals came at the
EC’s shadow banking conference in Brussels on
Friday, which followed the March 19 publication of the shadow
banking consultation paper.
The first recommendation addressed shadow banking vehicles or
funds that are sponsored or operated by banks. These entities,
said Tucker, should be consolidated on to bank balance
Although noting that
consolidation might require changes in accounting rules, which
could take time, the Bank of England deputy governor said the
vehicles and funds should be treated as consolidated in the
application of Basel III regulatory capital requirements.
"If necessary, Pillar 2...