Carney Seeks Middle Ground on Bank Crisis Writedown Rules
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Mark Carney, chairman of the Financial Stability Board, is trying to forge a global compromise on liabilities banks must hold that can automatically be written off in a crisis.
The Bank of England, which Carney also heads, and U.S. agencies want at least 20 percent of banks’ liabilities to consist of instruments such as unsecured debt that can be wiped out if the lender fails, according to three people with knowledge of the matter. Some European countries including France are pushing for a level of zero to 10 percent, said the people, who requested anonymity because the negotiations are private. Japan is also seeking to scale the rule back, one of the people said.