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CBI’s Cridland says ringfencing now is ‘barking mad’

Confederation of British Industry director general John Cridland says the Government would be “barking mad” to push forward with plans to ringfence UK banks, given the current economic conditions.

He told the Financial Times this week it would be wrong to implement Sir John Vickers’ expected proposals to separate the retail and investment arms of banks in the midst of the European debt crisis.

He said: “Taking action at this moment of growth peril, which weakens the ability of banks in Britain to provide the finance that businesses need to grow, is just to me barking mad.”

British Bankers’ Association chief executive Angela Knight has also called for a delay in implementing Vickers’ plans.

She says: “We have a high degree of uncertainty, market turbulence and lack of confidence that governments in other countries have got a sufficient grip on their economies.”

Vickers’ independent commission on banking is due to produce its final report this month. Chancellor George Osborne signalled his backing for the ringfencing plan at a Mansion House address in June.

Churchouse Financial Planning director Keith Churchouse says: “If the banks get fed up with UK regulation, they could move offshore.”

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