FCA's Bailey on Libor, 2008 Lessons, Woodford Redemption Freeze

The transcript covers the transition from Libor, highlighting bank readiness and the challenges of legacy trades. It discusses lessons from the Northern Rock crisis, the evolution of shadow banking, and market integrity. The Neil Woodford fund suspension is analyzed, emphasizing the need for orderly processes. Regulatory coordination is addressed, with comparisons to MiFID II and Brexit, underscoring the global impact of these financial changes.

What was the primary reason for setting an ambitious deadline for the end of Libor?

• To address declining market conditions

• To align with global financial trends

• To increase bank profitability

• To ensure banks remain competitive

What is a key challenge in dealing with the legacy of Libor?

• Increasing bank liquidity

• Implementing new banking technologies

• Ensuring market-led solutions are effective

• Reducing global interest rates

What was a major flaw in the banking system during the Northern Rock crisis?

• Excessive capital reserves

• Over-reliance on technology

• Inadequate liquidity buffers

• High interest rates

What was a significant regulatory focus post-financial crisis?

• Enhancing customer service

• Reducing bank sizes

• Coordinating global regulatory efforts

• Increasing bank fees

What term has replaced 'shadow banking' in discussions about financial intermediation?

• Microfinance

• Alternative finance

• Digital banking

• Non-bank finance

Why is it important to maintain investment in illiquid assets?

• To reduce market volatility

• To ensure high liquidity in markets

• To increase short-term profits

• To support long-term economic growth

How does the non-bank world contribute to financial stability?

• By holding more liquid assets

• By reducing the number of financial institutions

• By increasing interest rates

• By intermediating assets naturally held in non-bank vehicles