Boston Fed President: Banks must dump toxic assets

Banks need to get rid of toxic assets, Boston Federal Reserve Bank President Eric Rosengren told a group of bankers yesterday in Washington. The banks should eliminate bad loans quickly in order to free up more money for lending, he said at a meeting of the New York-based Institute of International Bankers, The Boston Globe reported. Mr. Rosengren also said that policymakers need to reconsider regulatory and accounting rules because models that banks use to estimate their reserves aren’t forward looking, the newspaper reported. Setting aside money to cover losses and holding on to capital will only prolong recovery from the credit crunch, he said.