Banking, I would argue, is the most heavily regulated industry in the world. Regulations don't solve things. Supervision solves things.
Sentiment: NEGATIVE
There is no evidence that more regulation makes things better. The most highly regulated industry in America is commercial banking, and that didn't save those institutions from making terrible decisions.
We need open, competitive, market economies... but at the same time with effective regulation and supervision.
In the U.A.E. we were the least-regulated environment in the region, and over time we are seeing more and more regulation coming in. On the other hand, a central bank can overregulate and choke the economy, and then we will have a dead banking industry.
You read constantly that banks are lobbying regulators and elected officials as if this is inappropriate. We don't look at it that way.
But let me tell you what happens when regulations go too far, when they seem to exist only for the purpose of justifying the existence of a regulator. It kills the people trying to start a business.
The fundamental problem with banks is what it's always been: they're in the business of banking, and banking, whether plain vanilla or incredibly sophisticated, is inherently risky.
I happen to know a bit about banking.
Is regulation per se bad? Is better regulation bad? I think better regulation is good for the business community, and I think that's something we should get together on.
Regulation is necessary, particularly in a sector, like the banking sector, which exposes countries and people to a risk.
We have put in place policies through supervision and regulation that has greatly enhanced the safety and soundness of the banking system.