I shall make some progress, and then I will certainly give way.
We must continue to make progress with sorting out the problems in the banking system. There is no quick or overnight fix, but it is important that we build on the recapitalisation of the banks. We must strengthen and restructure them where appropriate, and of course it is also important that we strengthen the regulatory system. We have to ensure that the supervision and regulation of institutions—including hedge funds—here and abroad are more extensive than in the past.
We must make sure that regulation is more intrusive than it has been in the past—a point that, to some extent, we discussed with Dunfermline building society yesterday. We need to strengthen prudential oversight: in future, we must make sure that banks throughout the world have sufficient reserves and that systems are in place to put the brakes on lending, where necessary.
We must also ensure better co-operation within the EU. We need common rules but, at the same time, we must respect the need for national supervisors to ensure an adequate system of regulation, here and throughout the world. The process of strengthening and improving the regulatory system is absolutely necessary, and of course it must be accompanied by a long-term culture change in bank boardrooms. Ultimately, it is the responsibility of banks' boards to get these things right, and it is important that they do so in future.
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