Bank reforms 'insubstantial'

The Chancellor's attempts to reform" Britain's banking system still do not go far enough, according to the panel of MPs and peers set up following the industry's rate-fixing scandal.

Banking commission: Government's reforms 'insubstantial'

Andrew Tyrie, chairman of the Independent Commission on Banking, called for further reserve power to break up banks if they do not adhere to rules to separate investment and high street operations.

He said:

The Bill is certainly much improved. However, the Government rejected a number of important recommendations.

The Commission has examined these again, alongside the Government's explanations for rejecting them.

We have concluded that the Government's arguments are insubstantial. There remains much more work to be done to improve the Bill.

– Andrew Tyrie

He added that the Government had also failed to address the panel's recommendation for a periodic, independent review of whether the ring-fence is doing its job. Bank of England governor Sir Mervyn King is among those in favour of this.

Panel: Banking reforms 'not enough'

The Chancellor's attempts to "re-set" Britain's banking system still do not go far enough, a panel set up following the industry's Libor-fixing scandal said today.

On the day that MPs debate the Banking Reform Bill, the Parliamentary Commission on Banking Standards stepped up pressure on the Government to back recommendations from its first report not currently in the planned legislation.

In particular, it wants more powers for the Bank of England to control how much banks can borrow, as well as for regulators to have the power to force a complete split of retail and investment banking operations.

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