The UK has apparently conducted its own stress test on some of its biggest banks including Royal Bank of Scotland and Lloyds TSB but Bloomberg is reporting that its Treasury is refusing to release the results for fear that it “may lead to uncertainty in financial markets, either in relation to specific institutions or more generally. Such instability could require further action by the authorities.” And I’m not sure what’s wrong with that.
This comes several weeks after the US has released the results of its own, much awaited stress tests aimed to reassure investors that the banking system is sound.
“The transparency of companies over the last few months has significantly improved so it is ironic that the one body who isn’t joining in the transparency is the regulator itself,” said Ian Gordon, an analyst at Exane BNP Paribas in London.
I’m fascinated by the authoritative difference that exists between the US and other developed countries, particularly in Europe. Whereas in the US, transparency, free markets and capitalism are advocated, Europeans (or its leaders) seem to be governing happily with a socialist-looking economy. Though I’m not sure whether to think it is working effectively at the moment when government intervention is much sought.