Here comes the cooldown

Here comes the cooldown
Central Bank's overheating concerns. Pic: RollingNews

With an overheating housing market boosting lending, the Central Bank is indicating it will move to force banks to increase their capital reserves. But are the banks ready for the consequences?

After the financial crisis that brought the world’s banks to their knees, the ability of regulators to prevent and intervene before the situation got out of control was questioned. Did they have enough power to stand up to the might of global banking giants? The answer to that was well and truly no. There may have been warnings about the dire consequences of outrageous actions by financial institutions, but nobody paid any heed to them. When the music was playing it was time to dance, was the famous quote of one American banker.

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