ECB tells bankers to get picky with risky clients, including hedge funds

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Reuters UK

FRANKFURT (Reuters) – Euro zone banks must be more selective with customers that make risky bets on financial markets, such as hedge funds, and become more prudent in how they manage their exposure to them, the European Central Bank said on Friday. The ECB’s move shows how regulators are stepping up scrutiny of the role of non-banks, a sector which has grown to represent roughly half the world’s financial system. The so-called non-bank sector ballooned after the global financial crisis as mainstream banks became more heavily regulated and its size is estimated at around $240 trillion according…

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