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Opinion
Mark Whitehouse

Markets Don't Trust Banks, and They're Right

The financial crisis should have led to fundamental change. It hasn’t happened.
Radically uncertain.

Radically uncertain.

Photographer: Dan Kitwood/Getty Images

Almost a decade after a crisis that nearly brought down the global financial system, markets still aren’t showing much confidence in banks. It’s a troubling phenomenon that U.S. and European leaders ignore at their peril.

It’s understandable that, after years of wrangling and thousands of pages of new rules, regulators might want to consider their mission accomplished. They have changed the way they supervise the system, reorganized derivatives markets, subjected banks to regular stress tests and instituted myriad new reporting requirements. To bolster banks’ loss-absorbing capacity, they have required hundreds of billions of dollars in added capital.