Turner throws his weight behind banks’ living wills
THE UK’s biggest banks will be forced to prepare for their own failure by simplifying their legal structures, which could end up increasing their tax bills, FSA chairman Lord Turner said yesterday.
Turner backed plans to make institutions draw up so-called “living wills” which make it easier for a bank to be broken up should it collapse.
He added that the process of simplifying a banks’ operations would also have the knock-on effect of reducing the complex structures that they often use to reduce their tax bills.
“Living wills will be a forcing device for the clarification and simplification of legal structures,” he said.
“In the past, authorities around the world have tended to be tolerant of the proliferation of complex legal structures designed to maximise tax and regulatory arbitrage,” he added.
“Now we have to demand clarity of legal structure,” he told the Financial Times in an interview.