Banking reforms backed by govt
19/12/2011
The coalition's decision to endorse reforms of the banking sector are highlighting the relationship between politicians and the City once again.
Vince Cable says he and George Osborne have reached "common ground" and decided to implement the proposals of the report put forward by Oxford University's Sir John Vickers in full.
As a result banks will be forced to separate their retail and investment arms and maintain capital reserves of between 17% and 20%.
The measures will not come into force until 2019, in a minor victory for City lobbyists who had called for the reforms to be put back even further - or abandoned completely.
But the coalition has committed to legislate on the changes by the end of this parliament, meaning bankers will have to begin preparing for the move.
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