Large banks proved ineffective during crisis: expert

Large banks proved ineffective during crisis: expert

ALMATY, April 14 (Xinhua) -- Many large banks have demonstratedtheir inefficiency during the economical crisis, and now it's timefor medium and small banks to step into the spotlight, said Chairmanof Eurasia insurance company Boris Uman.

"The crisis laid bare inefficiency of large monster-banks amidthe swift changes. The time has come for smaller banks to step outof the shadow, as they are much more risk manageable," he said at aninternational conference on risk management in Almaty on Thursday.

Umanov said that small banks do not have a need in the StressAssets Fund, and have no problems with repaying huge external debts,"since they live within their means."

According to Eurasia insurance company, in terms of riskmanagement the arrival of more small and medium-sized banks toreplace mega-banks would benefit the economy.

"The lack of players that are 'too big to fail' will save thegovernment billions of dollars, when coping with the crisis," saidUman.

He also added that very small niche banks, banks-boutiques, aswell as online banks operating solely in the Internet couldn't bedenied the right to exist. "The 21st century does not make itnecessary to build a physical branch network to reach the customer,"he said.

Eurasia insurance company established in 1995 operates in morethan 75 countries ranks among the 150 world leading re-insurers.