Lord Myners is calling on the Government to look at breaking up Lloyds Banking Group and the Royal Bank of Scotland.
Writing in today’s Financial Times, the ex-city minister says the future of the industry “lies in less monolithic organisations” and calls on the Commission on Banking, led by Sir John Vickers, to focus on boosting competition.
He says: “The future lies in less monolithic institutions, with more fluid entries into and out of the banking sector. And this in turn, may mean undoing existing bank mergers.
“Sir John should note that Britain’s banks are too concentrated and that each individually represents too great a proportion of gross domestic product.”
As city minister under the previous government, Myners was instrumental in striking bail-out deals for Lloyds and RBS.
He says: “The implicit support the most important of these receive from Government is now a competitive advantage and barrier to new entrants.”
“In practice the banking commission must therefore give proper consideration to splitting one or both of Lloyds Banking Group or the Royal Bank of Scotland.”