August 8, 2013 / 7:36 AM / in 5 years

BoE's Carney says banks must continue to strengthen balance sheets

Bank of England governor Mark Carney leads the bank's quarterly inflation report news conference at the Bank of England in London August 7, 2013. REUTERS/Simon Dawson/POOL

LONDON (Reuters) - The Bank of England needs to ensure that Britain’s banks change their culture and further strengthen their financial safety nets, new governor Mark Carney said on Thursday.

“Governor (Mervyn) King and his colleagues made tremendous progress on improving the balance sheets of the banks. We need to finish the job,” Carney said in a BBC radio interview.

“The cultural issue is fundamentally important. There has to be a change in the culture of these institutions,” he added.

On Wednesday the Bank of England broke with tradition by announcing that it planned to keep interest rates at a record low until unemployment falls to 7 percent or below, which it said could take three years.

Carney said on Thursday that it was important Britain did not make the same mistakes as Japan did 20 years ago, when it withdrew economic stimulus too early.

Reporting by David Milliken, editing by Kate Holton

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