A European Union law up for a vote today will only fully shield taxpayers from bailing out troubled banks if there is a global framework as well, a top UK regulator said.
Bank of England Deputy Governor Paul Tucker said the EU law on bank recovery and resolution would be a milestone towards a global system and help convince markets that governments were no longer willing to rescue "too big to fail" lenders.
Since governments had to shore up banks during the 2007-09 financial crisis, regulators have wanted to stop markets assuming big banks would not be allowed to go out of business.
The European Parliament's economic affairs committee holds a first vote in Strasbourg, France at 1830 GMT. It has joint say with EU states on the law that gives regulators powers to impose losses on creditors, replace management and take other steps when a bank gets into trouble.
Read more: BUSINESS WORLD - EU law to mean no more taxpayer bailouts
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