Cable says banks face radical reforms
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Business secretary Vince Cable has vowed to impose tough reforms on Britain’s biggest banks, stressing there is “no way of going back to the status quo”.
In his first newspaper interview since being appointed business secretary Cable told the Financial Times, that the banks faced being broken up, tougher lending controls and curbs on bonuses.
Cable said a key priority will be to force the banks to lend more to business. He said: “The banks are just not performing.”
He acknowledged that this could affect the profitability of Government backed banks Royal Bank of Scotland and Lloyds Banking Group but said there would be concrete changes even if Britain failed to secure international agreement.
He said: “The banking sector is going to have to accept disciplines on the way it operates, regulatory disciplines, and there is going to be a restructuring.”
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Readers' comments (1)
Anonymous | 17 May 2010 2:28 pm
I hope we will soon have Retail Banks that simply provide current accounts, deposit accounts, Cash ISAs, loan accounts, overdraft facilities, credit cards and mortgages where the respective credit charge is based on the individual creditworthiness of the consumer and not the overall debt position of the bank. Retail Banks in my opinion should not offer any other form of service/advice and should be separated from the commercial banking sector.
The corporate sector should be looked after by Merchant Banks /Commercial Banks providing commercial banking facilities, corporate finance and international trade finance for companies operating in the UK and overseas. These banks should not in my opinion be involved in capital markets trading and be separated from the Investment sector.
The investment sector should comprise of stockbrokers, commodity brokers, investment banks, investment companies/ managers,, financial futures traders, pension and insurance companies.
Nothing too radical just simply more acceptable.
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