January 15, 2012 / 9:03 PM / in 6 years

FSB's Carney rejects calls to delay bank reforms

LONDON (Reuters) - Financial Stability Board Chairman Mark Carney on Sunday rejected calls from the banking industry to delay planned tougher capital rules for lenders, saying such a move would not spur strong growth.

“There is much conflation and deliberate confusion of the consequences of global deleveraging ... with financial reform,” Carney told the Financial Times in an interview posted online on Sunday.

He rejected claims that “if somehow, we could stop the clock on these reforms ... the global economy would be growing at 5 percent,” he told the FT.

Banks say they may have to deleverage -- sell off assets and pull loans to businesses -- to comply on time with tougher global capital and liquidity rules being monitored by the FSB.

Carney, who also heads the Bank of Canada, took up the reins at the FSB last November when its then chairman, Mario Draghi, left to become European Central Bank president.

The FSB has been tasked by the Group of 20 top economies in the world (G20) to introduce and coordinate a raft of new rules to tighten supervision of banks, derivatives markets and other parts of the money system to apply lessons from the financial crisis, which saw taxpayers having to bailout lenders.

“If we’re successful, we’ll move towards ensuring that the system is not just resilient, but that it is efficient and it is fully productive in supporting the real economy,” Carney said.

It was still unclear how and whether the FSB should be beefed up to ensure its regulatory reforms are fully implemented by all member countries, he said.

Reporting by Huw Jones, editing by Maureen Bavdek

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