Lord Adair Turner, the head of the Financial Services Authority, last night launched an outspoken broadside at the banks, claiming their ability to create credit and money is ‘potentially dangerous’ and calling for unprecedented new powers for regulators to intervene in their lending. Turner, who is a member of the interim Financial Policy Committee, which oversees the stability of the banking system, said we cannot rely on free markets to ensure bank lending goes to ‘socially optimal’ borrowers such as small firms. He said that only a fifth of the vast expansion in bank balance sheets in the run up to the credit crunch had been funnelled into the real economy, and that excessive lending to sectors such as commercial property may be ‘at the expense of more socially valuable projects which...Read more on this story---> FSA chief Lord Turner launches fresh broadside at the banks | This is Money