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Sweden May Shelve Tougher Bank Rules If Recovery Is at Risk  

February 20, 2014
Johan Carlstrom and Niklas Magnusson, Bloomberg

Sweden’s government signaled it won’t push for stricter bank rules than those already agreed on if there are signs that doing so would put an economic recovery at risk.

“What you constantly need to take into the equation is not to hurt the growth that’s about to accelerate, but to find a suitable balance,” Financial Markets Minister Peter Norman said yesterday in an interview in Stockholm. “This is an economic experiment” and “a delicate balance,” he said.

The comments mark a change in tone after Sweden forced through some of the world’s strictest bank capital standards. Earlier this year, Finance MinisterAnders Borgcriticized lenders for paying what he characterized as excessive dividends, arguing the cash will be needed to comply with even tougher reserve rules in future. Swedish banks, including Nordea Bank AB (NDA), Swedbank AB (SWEDA) and SEB AB, have warned that setting capital requirements too high could jeopardize the recovery.

Read more: Bloomberg


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