Reckless hedge funds should not be at the core of major banks.
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However the report does acknowledge the improvement in core performance from the banks, and says it is due to two main factors.
Since this would force banks to write off all goodwill against banks' core capital, this might result in a flurry of end-year deals.
What's more, a European fund would not have to be big enough to deal with simultaneous deposit runs across all of Europe but only with ones in the periphery, since money would presumably flow to banks in core countries such as Germany.
And all of these banks at the core of this made really stupid decisions.
For these reasons, Mr Woodford thinks central banks should target core inflation rather than a broader measure.
Meanwhile, the decline in interest rates has been a great boon for commercial property, a core lending business for community banks.
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There is, however, a non-negligible risk in 2013 that one or more or the larger central banks outside of the core will turn to active selling.
Banks and voters in core countries (let alone Britain, whose position in a more integrated European banking system is very muddy) would be reluctant to insure peripheral deposits.
But I think the fundamental argument, which is perfectly sound and perfectly in keeping with both the white paper and the House bill, that we want to try to get banks back to the core function of relating to clients and not taking excess risky activities in the financial system.
In order to support high levels of wholesale funding, UBS says, banks may need to demonstrate levels of core Tier one capital, which is effectively common equity, well in excess of the levels most Eurozone banks currently hold.
Their core business consists of buying mortgages from banks and pooling them into bonds to be sold or held.
Which brings me to my next point: Many central banks tend to focus on core measures of inflation which strip out food and energy prices.
By the end of June 2012, banks are expected to establish a core-capital ratio of 9%.
And then it assumes the banks would need to preserve a core tier one ratio of either 7% or 8% on these stressed scenarios by the end of 2012.
And Nationwide's balance sheet, on paper at least, is stronger than that of any of the big banks, with loss-absorbing core capital equivalent to 12.5% of risk-weighted assets, 2.5 percentage points higher than the banks' capital ratios.
The core processing systems of insurance companies, airlines and banks, for instance, are built on a mainframe-computer technology that celebrated its 40th anniversary this year.
Banks will also be forced to increase their core tier 1 capital ratio to 9% by the end of 2011 and 10% by 2012, according to a note by Nomura.
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On Tuesday, shifting its focus from the weaker parts of the euro zone to the core, it cut the credit ratings of six German banks due to potential contagion from the rest of the financial system.
Furthermore, savers are no longer risk-happy Americans but Asian central banks, which have traditionally put bonds at the core of their portfolios.
Many banks on the continent - in so called "core" economies like France as well as Spain, Portugal etc - cannot really borrow on the interbank market at all at the moment.
CRD4 will oblige banks to increase the portion of best-quality "core capital" to 4.5%, from the current 2%, that they hold.
Both the banks reported earnings growth, but the results suggested their core businesses and net interest margins were under pressure from low interest rates.
He said that free current accounts provided a barrier to entry into the UK retail banking sector because this core product "is usually given away for free", prompting banks to try to make profits by pushing other products.
On Friday, the RBI said the guidelines to be issued next month would also cover non-core services like marketing and distribution of mutual funds and insurance products by banks.
"Banks had a better performance year in 2012 but their improved core profits were eaten up by fines and other exceptional items, leaving them down on 2011, " said Bill Michael of KPMG.
In lowering the reserve ratio to 1% from 2%, the ECB is hoping that banks can raise enough capital to meet 9% of their core Tier 1 ratios by June 2012, a level that the central bank set in October.
To enter the American market, Temenos acquired TriNovus which runs core banking and compliance software as a service for about 20 U.S. banks.
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