... is right to rejects Europe’s "idiotic" banking deal, a Times report shared below ...
My preference is for a stronger banking system that is never again too big to fail and is viewed by the world as first rate, no compromises with the EU please Osborne, just look at the mess they created with the failing Euro.
Britain’s relationship with Brussels took another hit last night after George Osborne refused to sign up to watered-down capital requirements for banks that he said could make him “look like an idiot”.
The Chancellor’s comments came as European finance ministers attempted to reach agreement on how to implement Basel III rules that require banks to raise their core tier one capital — a measure of financial strength — to 7 per cent by 2019. Mr Osborne wants to toughen up the EU’S interpretation of the rules, which he says could include loopholes to let some banks in Europe sidestep capital buffer levels. He also wants the freedom to impose higher capital buffers without the need for European permission in order to avoid another financial crisis.
“We are not implementing the Basel agreement, as anyone who will look at this text will be able to tell you,” he said. “I am not prepared to go out there and say something that is going to make me look like an idiot five minutes later.
“People will listen to what I say . . . I represent the largest financial centre in Europe. You have got to allow me to sit down and go through the issues. You have not done that.”
The bad-tempered exchange comes months after David Cameron vetoed a European Union fiscal treaty.
Michel Barnier, the EU commissioner in charge of financial regulation, suggested that Mr Osborne was looking for an effective opt-out with a proposal that would let Britain impose higher capital ratios than elsewhere in Europe.
Some on the Continent are worried that higher capital levels in Britain could put European institutions at a disadvantage because deposits and other business may be attracted to the UK if it was perceived by investors as being safer.
Mr Osborne rejected Mr Barnier’s theory. “I am not asking for some UK carve out. I will not be painted as somehow anti-european, demanding something especially for London,” he said.
One compromise that was offered suggested that Britain and Sweden, which also has a big financial sector relative to its overall economy, would have the option to tack on a capital buffer, but EU constraints on the decision making would remain. ........... in full £here