Why the UK needs to ditch the ringfencing of banks

The UK’s move to relax some of the so called ringfencing restrictions on the banking sector as part of wider ‘Big Bang 2.0” reforms after Brexit is a case of too little, too late.

The move is welcome but if the UK really wants its liberalisation to be both big and to have a bang, it should simply abandon the ringfence.

The ringfence was the brainchild of proposals made by the Independent Commission on Banking (ICB) over a decade ago in the wake of the 2007-2008 financial crisis, where the UK suffered the largest global bailout of any banking sector.

That change was needed was without dispute — the risks of bank failure and taxpayer bailout had to be reduced.

Continue reading at the Financial Post

Featured article, Michael C., Public domain, via Wikimedia Commons.