Big banks need extra trillion-euro cushion against future crises: G20 dvisory body

The world's biggest banks must bolster their cash reserves by up to 1.1 trillion euros ($1.2 trillion) as protection against any future financial crises, an influential advisory body said on Monday. The Financial Stability Board (FSB), which advises G20 countries on banking reform, said banks considered "too big to fail" had still not done enough in the wake the 2008 financial crisis to ensure their own survival should disaster strike again.
To protect taxpayers from having to foot the bill of banking bailouts again, the biggest banks should raise between 457 billion and 1.1 trillion euros of additional cash, it said. By 2019, the world's 30 biggest banks, known as the Global Systemically Important Banks (G-SIB), need to establish a cash cushion allowing them to absorb losses equivalent to 16 percent of their assets, the FSB said.
This requirement would grow to 18 percent by 2022, according to the body's final recommendations. "The FSB has agreed a robust global standard so that G-SIBs can fail without placing the rest of the financial system or public funds at risk of loss," FSB chairman Mark Carney, who is also Bank of England governor, said in a statement.