The British Bankers' Association, a lobby group, expressed concern over the Financial Services Authority (FSA) stringent new liquidity buffers that will be a part of its strategy to overhaul firms' liquidity risk management practices.

Simon Hills, the association's executive director for prudential capital and risk, said: "These proposals would oblige banks to hold high amounts of government bonds, rather than allowing them to diversify their assets." Money held in these "liquidity buffers" is