REDRAWING THE BANKING SOCIAL CONTRACT

"It is not often a central banker can speak openly about bank failures. Indeed, most of the time, central bankers avoid public remarks on issues like Too Big To Fail; Emergency Liquidity Assistance; flaws in insolvency regimes; burden sharing between national authorities, and so on. But surrounded as we are by failed banks, it is not only possible to talk about bank failures without scaring the horses; it would be irresponsible not to do so. And as central bankers and regulators free themselves from that mental straight jacket, new and perhaps far reaching ideas are emerging."

REGIMES FOR HANDLING BANK FAILURES: REDRAWING THE BANKING SOCIAL CONTRACT
PAUL TUCKER
DEPUTY GOVERNOR, FINANCIAL STABILITY,
BANK OF ENGLAND
at the British Bankers’ Association Annual International Banking Conference:
Restoring Confidence – Moving Forward
London
30 June 2009
http://www.bankofengland.co.uk/publications/speeches/2009/speech396.pdf