Are Regulators asleep again?

There is still more talk than action in banking reform. We do not seem to be alone when making this observation. Volcker rule, Basel III, contingent capital - all these buzzwords are worthless if nothing gets implemented at some stage. News of generous bonus pools give the impression that all is back to normal in the banking world but when we had a look at the capital ratios of some large banks we were genuinely surprised - if not shocked - about the abysmal capital ratios that some of them reveal. Balance sheet totals seem to expand and the simple ratio of pure equity is in the low single-digits, and falling! So investors have to be more vigilant than ever when deciding how to allocate their investments. More than ever it is not the return on the investment that counts but the return of the investment.