bank transparency

Banking Opaqueness



crisis facade transparent
shore shore up summit (2)
haggle oversight throw/threw/thrown
thesis bailout scramble (2)
set up bother convinced
profit mankind approach (2)
excess articulate regulation
chase admit (2) chief executive
affect relevant in their favor
rage conspire manipulate
limit way (2) maximize
strict scandal sustainability
fair (2) influence take advantage of
grant complex requirement
flood earmark real estate
call for mortgage transparency
fellow insider Europe-wide





Many facades of Europe’s big banks may be glass — but doesn’t make their business dealings transparent.

One crisis summit follows another as EU leaders scramble to shore up the Euro.

They throw ever more billions into bailouts, and haggle over an EU banking union and a common bank oversight agency.

Joscha Ruoff, Writing a Thesis on Bank Regulation: “The way it’s set up now, bank oversight is itself unmanageable. So we’re dealing with an unmanageable system.

Wendelin Sankuhler, Economic Science Student: “It bothers me when people only think about maximizing profits. It’s a very horrifying image of mankind and a very simple-minded approach.

Wendelin Sankuhler and Joscha Ruoff are economics students. And they’re convinced that banks must change their ways and do business more fairly.

Ruoff is even writing his thesis on bank regulation. The news media are supplying plenty of material right now, with one scandal chasing another.

Former chief executive of the British banking group Barclay, Bob Diamond, recently admitted his bank had helped manipulate the London interbank interested rate, the LIBOR.

Barclays had conspired with twenty other big banks to manipulate the LIBOR in their favor.

Wendelin Sankuhler, Economic Science Student: “That shows the complexity of the issues. It may be a highly relevant issue affecting billions of Euros in tax money. But if people don’t understand it, they can’t articulate their rage.

We’ve got to limit the excesses of the financial system.”

They’ve joined fifty other students at Cologne University in calling for greater fairness and sustainability in the economy. And for an end to overly complex financial dealings.

Their professor, Thomas Hartmann-Wendels, supports many of their positions. He’s also convinced that the banks have to be far more strictly controlled.

Professor Thomas Hartmann-Wendels, Expert on German Banking System: The opportunities for making money through wrongdoing are growing all the time. You can earn more money faster by taking advantage of insider information, or using certain positions of power or influence the trader may have.”

For years, Spanish banks have been granting easy mortgages — even though the real estate market was flooded.

Now just like their American counterparts, they’re in deep trouble.

The EU has earmarked €100 billion Euros to help bail them out.

Did Spain fail to oversee its banks adequately?

How would a Europe-wide bank oversight agency work?

Joscha Ruoff, Writing a Thesis on Bank Regulation: “There’s a very simple solution — and that’s transparency. The current banking regulations, such as the Basel Capital Requirements, are so complex and overly complicated, that even the national bank regulators have trouble understanding them.”

In their lectures, the economics students are hearing more and more about banks’ public images and stricter regulations.

Wendelin Sankuhler and his fellow students have no doubt that big finance has got to become fair and sustainable.

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1. The EU has been experiencing a series of financial problems. True or false? What examples did they give?

2. Do banks have a common, standard regulations with an oversight commission?

3. “People only think about maximizing profits.” Is this good, bad, both, in between, it depends or it makes no difference (it doesn’t matter)?

4. Only finance experts and economics professors understand and care about the situation. Is this correct or wrong?

5. Are banking rules and regulations straightforward or extremely complicated? Is this good, bad, both, it depends, or it makes no difference (it doesn’t matter)?

6. Does the university professor think there should be more, less or the same about of financial controls?

7. What do the students and professor recommend? What should banks and the government do?

A. Do you hear about banking crisis and scandals? Give examples.

B. People completely trust banks. What do you think?

C. What are the causes of banking problems?

D. What are some solutions?

E. What may happen in the future?

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