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(TOBY MELVILLE/REUTERS)

Financial Times

U.K. legislators tussle over yardstick for bank risk

Reuters Breakingviews delivers agenda-setting financial insight. Its global correspondents react to stories as they develop, delivering sharp and provocative commentary on big financial news as it breaks.

As regulators work their way through the mess of the banking crisis, it is hardly surprising that many hanker after simpler times when a loan was a loan, and equity was equity. A desire for simplicity is perhaps one of the reasons U.K. legislators have picked a fight with the government over leverage ratios, the basic measure of a bank’s equity as a proportion of total assets.