Phil Purcell, former Chairman and CEO of Morgan Stanley: “There is one benefit of breakups that hasn’t gotten much publicity: Shareholders would get greater value from their investments.”
Wilbur Ross, CEO of WL Ross & Co: “Running an insurance company is not the same thing as running a retail bank. We don’t think there’s any logic in them being in the same entity.”
Scott Shay, founder of Signature Bank: “Fixing the banking system and reinstating Glass Steagall should be the highest priority.” Also: ”We wouldn’t trust our national defense to four military bases, but we trust our national economic security to four big banks.”
Roy Smith, former partner at Goldman Sachs: “Based on changing markets and increasing regulatory pressures, it is time to unwind the mega-banks into smaller, simpler, less risky business models.”
Dan Tarullo, governor of the Fed:”To the extent one can fairly induce an underlying principle, it is that the moral hazard associated with too-big- to-fail institutions should be counteracted in a variety of ways.”
Paul Volcker, former Fed chair: “There is an expectation that very large and complicated financial institutions will not be allowed to fail. Unless that conviction is shaken, the natural result is that risk-taking will be encouraged and in fact subsidized beyond reasonable limits.”
Sandy Weill, former Citi CEO: “What we should probably do is go and split up investment banking from banking, have banks be deposit takers, have banks make commercial loans and real estate loans, have banks do something that’s not going to risk the taxpayer dollars, that’s not too big to fail.”
