No recanting from Turner on City reform

David Hellier
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IN recent weeks Lord Turner has become the b&ecirc;te noire of the City. In conversation with Prospect magazine, the head of the Financial Services Authority suggested that some parts of the City may not be socially worthwhile.&nbsp; If anybody thought that last night&rsquo;s Lord Mayor&rsquo;s banquet would be an ideal opportunity for Turner to think again, they were wrong. &ldquo;I will not be recanting,&rdquo; he said.<br /><br />He pressed on with his campaign to persuade financiers to reform urgently in order to prevent the near-death experience of the recent past from happening again &ndash; and again accused bankers of having &ldquo;cooked up the crisis&rdquo;. <br /><br />He wants banks to hold more capital in the good times, which might mean bank investors having to settle for lower returns. He said the regulator &ndash; set for abolition if the Tories win the next election &ndash; will impose a more &ldquo;assertive&rdquo; style of supervision at a firm level. Extra capital would need to be put aside to cover transactions&nbsp; or investments in innovative financial instruments &ndash; even if that meant those markets would shrink as a result.<br /><br />Turner called for bankers to do something that few in his audience would have considered prudent in these straitened times: walk away from profitable activities if they felt they might be socially useless.<br /><br />Turner joked that heretics in the past used to be burned at Smithfield. But there was nothing to fear from last night&rsquo;s audience, who (with the exception of an angry Ukip MEP) listened politely to a man whose views they must find increasingly uncomfortable.