The Independent Commission on Banking’s (ICB) interim report, published in April, avoided a complete separation of retail and investment banking.
Under its recommendations, banks will still be able to transfer capital and liquidity from their UK retail banking activities to their investment banking business, but the ICB is considering forms of ring-fencing for retail operations.
The ICB’s brief is to come up with proposals to protect tax-payers and make UK banking safer and more competitive. As part of the proposals it recommended that large banks be required to maintain core tier-one equity capital of 10%.
William Newsom, UK head of valuation at Savills, who produces regular lists of banks active in property lending, said he thought the interim proposals were “largely benign”. The final report to government is due in September.