February, 02 , 2010

Political “meddling” has emerged as the greatest threat to the global banking industry for the first time, according to a report highlighting the biggest risks faced by financial markets in 2010.The survey, conducted by the Centre for the Study of Financial Innovation, an industry think-tank, comes as bankers are facing unprecedented levels of attention from governments worldwide after the financial crisis.Bankers are waiting for details of US proposals that would curb their size and limit their activities, while politicians elsewhere are considering other measures.

Many countries, including the UK and the US, have already introduced new tax charges on bankers’ pay and implemented tougher regulation.In the CSFI report, political interference, which has never before been identified as a risk in the survey, was considered the most severe threat to global markets, ranking above credit risk, over-regulation, macroeconomic trends, liquidity and the availability of capital.In the think-tank’s previous report, produced at the end of 2008, liquidity issues were named as the greatest risk to banks, while during the boom years, concerns were centred on the strength of banks’ management teams.