Biggest Banks Are Less Likely to Wreck the Economy Than a Decade Ago
- Post-crisis rules made financial giants more safe, BIS says
- Weak profitability now keeps firms from improving further
Photographer: John Taggart/Bloomberg
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After a decade of being regulators’ favorite target, the world’s biggest banks now pose less of a risk to the economy than before the financial crisis, according to the Bank for International Settlements.
The most important institutions today are more resilient to shocks, and thus significantly less likely to run into trouble, just as regulatory reforms first introduced in 2011 had intended, the BIS said in its latest quarterly review, which was released Sunday. At the same time, these banks became less critical to the overall financial system, it said.