GORDON Brown last night issued a warning to banks in Britain and around the world that they must end risky speculation and resume their traditional role as “stewards” of people’s money.
The Prime Minister was among eight European leaders meeting in Berlin who agreed proposals to overhaul the global financial system, bringing hedge funds and other elements of the “shadow banking system” under international supervision.
“We have got to show together that we can restructure the banking system around sound banking principles that deliver the integrity and the trust and the openness and transparency that is essential for people to once again trust the banks,” he told the closing news conference.
“We are are looking at how, working with all continents, we can ensure the best means by which the banking system can serve the public - stewards of people’s money rather than speculators with people’s money.”
Earlier, however, Mr Brown targeted his comments directly at Britain’s high street lenders, calling for a return to “traditional” banking practices and “prudent” lending.
The Berlin meeting, hosted by German Chancellor Angela Merkel, was designed to firm up a common European position ahead of the G20 summit of advanced and developing nations in London in April.
Mr Brown and Chancellor Alistair Darling were returning to London tonight to be briefed on talks which took place over the weekend between the Treasury and UK banks on the Government’s asset-protection scheme.
The plan, which is expected to be finalised this week, will see the taxpayer underwrite the so-called “toxic” assets held by banks in an effort to get the flow of credit going again.
