Banks are being lectured Claudia Sonea
Federal Reserve Chairman Ben Bernanke stepped up and lectured banks on Thursday at the banking conference in Chicago about risk management in an environment agitated by housing, credit and financial crisis. Banks were not well prepared against shocks and that is why the housing market crisis made them lose multibillion dollars. They will need to bring some improvements so that when they have such issues, with cash or the buying and selling, to be prepared. For that they will have to be able to identify and measure risk and keep an eye on the already fragile market. Bernanke reinforced the need for capital of banks and other financial institutions in order for new credit to be created, thus called for them to continue their efforts. Fed's Chairman did not forget that regulators have to be quicker and show more promptitude in their actions. Yet, he hasn't mentioned anything about interest rates or about US economy. Analysts believe that after the seventh cut that took place last month, Fed will focus on actually giving a hand of help to banks and financials institutions in overcoming the crisis. Also the government plan offering tax rebates and tax breaks to individuals and to business is expected to improve the US situation. Bernanke confessed that banks still have a major role in economy and the fact that credit market has been affected by their turmoil proves it. Now, they shouldn't boast about it because despite everything, the Fed will not go for any more rate cuts.
related story: http://news.yahoo.com/s/ap/20080515/ap_on_bi_ge/bernanke_credit_crisis;_ylt=AuUSmAJohCTv2DX6O_pHra6s0NUE
| by Claudia Sonea for PocketNews (http://pocketnews.tv) |
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