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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: see clearly now who wrote (92343)	7/9/2012 12:31:50 PM
From: elmatador	Respond to of 217648

a forced break-up of investment banks from their retail arms if banks did not comply with the Vickers reforms on ringfencing. separating investment banks – dubbed “casino banks” by Labour – from those serving consumers on the high street. Labour hints at separating ‘casino’ banks By Hannah Kuchler and Kiran Stacey Labour hinted on Monday it would consider supporting a forced break-up of investment banks from their retail arms if banks did not comply with the Vickers reforms on ringfencing. Speaking at the Co-operative bank after a speech by Labour leader Ed Miliband, Ed Balls, shadow chancellor, said he had to stay open to all possibilities when it came to separating investment banks – dubbed “casino banks” by Labour – from those serving consumers on the high street. Asked about the possibility of a Glass-Steagall style split, Mr Balls said: “The question for the banks is can they show the leadership and cultural change they need by complying with the hard ringfence? The banks have got to show quickly that they will do this. We should be open to looking at every issue which comes up in advance of that.” In his speech, Mr Miliband accused the government of failing to rise to the challenge of reform and watering down the recommendations of the Vickers commission. The coalition government says it remains committed to the model laid out by Sir John Vickers last year. The Labour leader advocated a return to “stewardship banking” when banks cared about local businesses, lamenting the current culture which he said was driven by short term gain and immediate return. “Nobody can really believe that the current way of running things is in the interests of British business. The revelations of the last two weeks have shown precisely what has gone wrong in our economy in the last decades,” Mr Miliband said. Mr Miliband also echoed calls by Vince Cable, business secretary, for Barclays shareholders to prevent Bob Diamond, the former chief executive, from receiving a payout on his departure. “People will not understand how somebody who resigned over bad practice at his bank then walks away with the jackpot,” he said. Making the most of a new wave of popular anger against the banks provoked by the Libor scandal, Mr Miliband unveiled his proposals for “root and branch” reform to the banking system on Sunday. He suggested the big five banks be pushed to sell off 1,000 branches and introduce transferable account numbers to make it easier for consumers to switch banks. In his speech on Monday, he called for a state-backed investment bank which would allow the government to underwrite loans to small businesses. The bank could be modelled on the US Small Business Association, which he said had helped Steve Jobs build Apple. In the wake of the Libor scandal, he called for a new unit to tackle financial crime, a code of conduct and the power to permanently strike off bankers. Mr Miliband said the scandal showed he had been right to crusade against “predatory capitalism” which he launched in his conference speech last autumn. “Some people said my speech was anti-business. Or didn’t understand what I meant by predatory capitalism. Sadly, after the recent revelations nobody can be in any doubt about what I was talking about,” he said. Copyright The Financial Times Limited 2012. You may share using our article tools. Please don't cut articles from FT.com and redistribute by email or post to the web.