Lew: U.S. must combat 'destabilizing' bank runs

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Lew: U.S. must combat 'destabilizing' bank runs
WASHINGTON (MarketWatch) - A top priority for Washington in the coming year is to take steps to combat the threat of modern-day bank runs and fire sales, Treasury Secretary Jacob Lew said Thursday to a multi-agency panel of regulators charged with identifying threats to the stability of the economy. "We need to strengthen markets that may be susceptible to destabilizing runs and fire sales," he said. Lew made the comments at the beginning of a meeting to vote on releasing the group's third annual report to Congress. He added that a great deal of work remains to be done to attract private capital to the U.S. housing finance system. U.S. regulators must also work with their foreign counterparts to consider transitions towards alternative benchmarks to the Libor overnight interest rate, which is at the center of a massive-industry-wide international investigation into rate rigging, he said. Regulators need to increase their "vigilance" to operational risks, he added.

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