Market Overview

U.K. Commission Calls for Bank Capital Increases

Share:

The United Kingdom's Independent Commission on Banking recommended Monday that the nation's banks increase Tier 1 capital levels to about 10 percent. The proposal was among others listed in a report on ways to increase competition and safety in the British banking sector.

“Rather than pursuing more radical policies towards capital or structure, the approach outlined is a combination of more moderate measures,” the report said. “They nevertheless entail costs to banks, some of which fall on the wider economy.”

According to a Bloomberg report, "John Vickers, 52, chairman of the commission and former Bank of England chief economist, was asked by the government last year to make recommendations to ensure greater competition and the safety of British banking in the event of another financial crisis. Today's publication opens the way to five months of lobbying before the final report is handed to Chancellor of the Exchequer George Osborne and Business Secretary Vince Cable in September."

Other proposals include plans for orderly dissolution of financial institutions and so-called ring-fence consumer units.

“A retail ring-fence can preserve the possibility that the wholesale/investment banking operations of a universal bank can save the retail banking operations while curtailing the possibility that they can sink them,” the report said.

London's FTSE Index is up slightly Monday, to 6,061.

Posted-In: Bank Of England Bloomberg United Kingdom's Independent Commission on BankingNews Global Economics Intraday Update

 

Related Articles

View Comments and Join the Discussion!
Fastest Market News Application
You'll Hear It First On Pro
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Trading Daily
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com

Exane BNP Paribas Ups Rolls-Royce To Outperform

Why aren't the honest bankers demanding prosecutions of their dishonest rivals?