UK banks are guilty of manipulating the country’s loose regulations to undercut their European competitors and should be regulated by a pan-European body, Hans-Werner Sinn, president of the Ifo Institute for Economic Research, told CNBC Wednesday.
“A single country tends to undercut the regulatory rules of its competitors so as to attract banking business, and I think the Brits have played that game for quite a while with disastrous implications for Europe and the world,” Sinn told “European Closing Bell.”
“If countries regulate their companies themselves, there is always the risk of competition of laxity,” he added, indicating the lowest possible quality standards would win out.