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FT Calls Them Out

An FT editorial today calls out banks' bogus arguments for delaying reform due to concern for lending and the economy:  "The real reason smaller businesses are not very creditworthy is because of the lacklustre state of the economy. But if one believed that ringfencing could really hurt lending more, the solution would be to impose absolute capital levels for a transition period, based on current balance sheets. That would remove the incentive for banks to meet the required ratio by shrinking assets rather than increasing capital. It could be done without delaying reform."http://www.ft.com/intl/cms/s/0/11195ee8-d491-11e0-a42b-00144feab49a.html#axzz1Wv9QkjYx

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