http://www.reuters.com/article/2011...rbssFinancialServicesAndRealEstateNews&rpc=43 "Financial regulation will not prevent the next financial crisis and it can work against firms in financially sound countries such as Canada, Rick Waugh, chief executive of the country's No. 3 bank, Bank of Nova Scotia (BNS.TO), said on Tuesday." "New rules being put in place to govern the global financial system, such as Basel III, and the U.S. Dodd-Frank legislation, impose a one-size-fits-all model and are backward-looking..." "'Remember, prescriptive rules can be like (France's) Maginot Line, which of course was that very complex system built prior to World War II, based on the experiences of World War I, and of course, was not effective at all because of the newer methods of attack," he said." "Waugh, vice chairman of the Institute of International Finance, which represents 460 of the world's largest financial institutions, argued that those jurisdictions that were hurt worse than others in the crisis require greater changes and oversight than those that came out relatively unscathed." "No regulation, no rule, prohibited us from participating in subprime, CDOs, high-yield bonds, covenant-light loans, all of these toxic, toxic assets," Waugh said. "We chose not to participate, or if we did ... and we did make some mistakes, but at low levels, so it never put our bank at true risk." Waugh added that Basel regulations actually encouraged institutions to buy European sovereign debt, from countries such as Iceland and Ireland, because the rules did not require capital to be put up against it. "History has shown that no amount of prescribed regulation can replace sound management and principles-based governance, or a board or a management team who are accountable to the results to their shareholders," he said.