View more on these topics

Miliband promises two challenger banks amid major branch sell off

Labour leader Ed Mililband is to say the ‘big five’ banks must sell off a “significant” number of branches to make room for at least two challenger banks, in a speech later today.

According to the BBC, in his speech at the University of London today, Miliband will promise to create two or more challenger banks which have a “substantial proportion” of the market and can compete properly with the existing large players.

The big five – Lloyds Banking Group, Royal Bank of Scotland, Santander, Barclays and HSBC – currently have 90 per cent of the current account market.

Miliband will say a Labour government would instruct the Competition and Markets Authority to report within six months of the May 2015 general election on a limit on banks’ market share and the timetable for any sell-off of branches. Branch sell offs should be completed by 2020, he will say.

Miliband will say: “Of course, financial services is an important industry in itself. But for an industry that calls itself a ‘service’, it has been an incredibly poor servant of the real economy, not just since 2010 – or 2008 – but for decades in this country.

“We need a reckoning with our banking system, not for retribution, but for reform.”

He is expected to say that Britain should follow the example of the US and establish a threshold for the market share any one bank can have of personal accounts and small business lending.

Labour would also introduce a new National Credit Register for small and medium-sized businesses, which it claims would increase competition and improve lending to small businesses by allowing all banks access to comprehensive data on their credit histories.

Earlier this week, Bank of England governor Mark Carney rejected the proposals to break up the big five banks claiming it would not boost competition and could lead to financial instability.


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm