The UK's Chief Banking Regulator Talks About Lessons Learnt About Managing Bank Failures

In a speech published on 16 October, Sam Woods the Deputy Governor for Prudential Regulation and CEO of the Prudential Regulation Authority ("PRA") discussed this year's banking failures, the lessons learnt and priorities going forward in the work that needs to be done to "improve and refine the regulatory regime for banks". While dismissing the idea of a zero-failure regime, the speech does examine the efficacy of tools to accommodate the PRA's "zero appetite for systemic financial crises":

• Measuring risk correctly: Woods points to variability of risk-weights across firms and jurisdictions as being a drain on confidence in the banking system that upcoming Basel 3.1 refinements are intended to address. Interestingly, Woods does not believe that there will be a meaningful increase in aggregate capital levels for UK banks as a result of Basel 3.1 roll-out;