Thomas Huertas of FSA spoke on curing the crisis. He spoke on the changes to capital and liquidity requirements and other key changes. He focused on:
- the increase in the amount of capital required to back trading activities;
- improving the quality of capital;
- increasing the quantity of capital;
- introducing a leverage ratio as a backward stop to the primary risk-weighted regime; and
- improving the loss-absorption capacity of non-core capital.
He looked also at the new liquidity rules, which he said would force banks to:
- measure the amount of liquidity risk that they are taking;
- hold a buffer of truly liquid assets against that potential liquidity shortfall; and
- assume a stable funding profile.
He also discussed measures on remuneration, supervision and macro-prudential regulatory priorities.