UK Regulators Could Kick Out Bank Chiefs Under New Stress Test Plans

economywatch.com Senior bankers at top U.K. financial institutions could be fired, or even sent to jail for up to seven years, if theirs bank fails to meet new stress test requirements proposed by the Bank of England on Tuesday, according to a report by The Telegraph. The draft law is just one of a series of 86 proposed amendments included to the U.K.’s Banking Reform Bill, which would provide a more stringent approval regime for bankers, stronger regulatory powers to boost competition in the industry, and new laws to “bail in” bank creditors in the event of a lenders’ collapse so as to spare taxpayers the cost of another bail-out. The Bank of England added that the stress test of the U.K.’s biggest banks would be conducted annually, starting from 2014; with the largest banks required to hold more capital than their international rivals or “at the very least, banks would need to maintain sufficient capital to be able to absorb losses in the stress scenario and not fall below internationally agreed minimum standards," the Bank of England said. Medium-sized British banks are likely to face a cut-down version of the test, and clearing houses could face their own health checks later on, the central bank added. to read more click here: economywatch.com