Bank regulators need to empower the shareholders of banks.

Sir, John Authers prays for that “Shareholders will play a decisive role in banker’s pay” July 2. 

Yes, that could happen, if regulators order the banks to listen more to the shareholders. And, for that to happen, they have to get rid of regulations that basically tell the bankers to ignore their shareholders. For instance, in Basel II, if a bank lends to one of the “infallible sovereigns” it is not required to have any capital, any shareholder, at all. 

The best way regulators could help to empower shareholders again is to require the banks to hold, for instance, 8 percent in equity against any asset.