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Is 'Too Big to Fail' Still a Thriving Concept?

Five years after Lehman Brothers' seismic bust and just two years after euro member Greece defaulted, the concept of being too big or too strategic to fail is alive and well.Although unwritten government guarantees of big banks have been at the heart of taxpayer outrage over being left on the hook for the missteps of giant corporations, few politicians or voters are keen to embrace another 'Lehman moment' or the global economic implosion that ensued.Tighter regulation on capital buffers and risk-taking, the insistence that banks have 'living wills' for any future workout procedure, creditor 'bail-in' bonds and even the ring-fencing of certain operations within banks have all been preferred routes to limit the exposure of both society and shareholders.Yet, as an International Monetary Fund study detailed this week, there's still a running assumption that governments would again rescue the biggest banks in the event of another panic.The IMF found that at least through 2012 the euro zone'...

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  1. 'Too Big to Fail' still thriving

    Five years after Lehman Brothers' seismic bust and just two years after euro member Greece defaulted, the concept of being too big or too strategic to fail is alive ...

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