# Building a banking regime for the future - speech by David Bailey

> Building a banking regime for the future - speech by David Bailey. A business report — sourced from Bank of England Speeches.

*Section: Business — By Marcus Vale (Editor-in-Chief & Business & Markets Editor) — Published July 12, 2026 — 1 min read*

Canonical URL: https://dailyjunction.org/business/building-a-banking-regime-for-the-future-speech-by-david-bailey
Tags: ai, bank of england, banking, building, business, future, regime

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The Bank of England's executive director for prudential policy has set out a vision for the future of banking regulation, arguing that the framework developed in the aftermath of the financial crisis needs to evolve to address the challenges of a financial system that has been transformed by technology, competition and the growth of non-bank finance.

In a speech to a banking industry conference, David Bailey said the regulatory framework that had been put in place since 2008 had been successful in its primary objective of making the banking system safer. But he argued that the framework had also created unintended consequences, including a regulatory burden that fell disproportionately on smaller banks, a framework that was too complex for investors and analysts to understand, and a perimeter that excluded activities that were economically equivalent to banking.

Bailey set out three principles for the evolution of the framework. First, regulation should be proportionate, with requirements calibrated to the risks that different institutions pose. Second, the framework should be simple enough to be understood by the people it is intended to protect — investors, depositors and the public — as well as by the people it regulates. Third, the regulatory perimeter should be dynamic, expanding to capture new activities that pose risks to financial stability and contracting where activities no longer warrant regulatory attention.

The speech was welcomed by smaller banks, which have long argued that the regulatory framework is calibrated for the largest institutions and imposes costs that are disproportionate to the risks they pose. The Bank said it would publish proposals for reform later this year.

## Sources

- [Bank of England Speeches](https://www.bankofengland.co.uk/speech/2026/april/david-bailey-speech-jp-morgan-uk-banks-asset-and-liability-mgmt-conference)

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