By Jonathan Spicer
NEW YORK, March 26 A U.S. government official
said on Tuesday that it was too soon to draw conclusions on
financial stability from the bailout of Cyprus, which has
rattled markets globally over the past week and a half.
It is still "early days," Richard Berner, the newly
appointed director of the U.S. Treasury's Office of Financial
Research, said, when asked what lessons the United States might
learn on the durability of financial markets.
"I think it's probably early days and too soon to draw those
lessons," Berner said after a speech at New York University's
Stern School of Business. "That's something that's going to be
worth looking at."
Large depositors in Cyprus, many of them rich foreigners,
face losses after the small island nation struck a deal with
international lending bodies designed to bail out and rein in
the oversized financial sector.
The deal should keep Cyprus in the European single currency
union. With the country's banks ordered to remain closed until
Thursday, and the government there having not yet revealed how
it plans to prevent runs on the banks, investors still remained
wary of the situation on Tuesday.
In one of his first public appearances as director of the
Office of Financial Research, or OFR, Berner said Europe has
long been identified as a threat to U.S. financial stability.
"We'll continue to focus on that," he said.
The OFR was created by the Dodd-Frank regulatory overhaul to
help regulators prevent a repetition of the 2007-2009 financial
The agency, responsible for collecting and analyzing data to
support the Financial Stability Oversight Council, has been
under scrutiny for its slow progress. Many Republicans in the
Senate want to see it scrapped.
Berner, a former chief economist for Morgan Stanley, began
his six-year term in January.