Banks seek to hold back the tide of regulation
Originally posted by 5corpio
Banks and other financial companies claim new regulation is the biggest threat they face in the next year as industry unrest about tougher rules hits a record high, a CBI survey shows.
Some leading banks have reportedly offered the compromise of "ring-fencing" their core functions that carry a taxpayer guarantee, rather than having them hived off.
The moves come as the Independent Banking Commission, chaired by Sir John Vickers, prepares to release its interim report in about a week.
In the first quarter of this year, the proportion of firms saying legislation and regulation could limit business growth was the highest since the CBI/PwC quarterly survey started in 1989. Companies also highlighted uncertainty about new rules coming down the track.
Ian McCafferty, chief economist at the CBI, said: "The issue on everybody's lips in the financial services sector at the moment which is acting as a constraint on their businesses is the outlook for regulation. The number of people saying they don't know how it is going to affect their businesses reflects a high degree of uncertainty."
Complaints about regulation in the survey reinforce arguments made by Britain's bank bosses in recent weeks.
The banks are trying to water down plans for tougher rules by claiming their profitability will be hit – with an implicit threat to tax revenues and the Government's chances of selling stakes in state-supported banks.
Stephen Hester, chief executive of Royal Bank of Scotland, highlighted tighter regulation as the top threat to his bank's performance apart from.....Read more Here
Some leading banks have reportedly offered the compromise of "ring-fencing" their core functions that carry a taxpayer guarantee, rather than having them hived off.
The moves come as the Independent Banking Commission, chaired by Sir John Vickers, prepares to release its interim report in about a week.
In the first quarter of this year, the proportion of firms saying legislation and regulation could limit business growth was the highest since the CBI/PwC quarterly survey started in 1989. Companies also highlighted uncertainty about new rules coming down the track.
Ian McCafferty, chief economist at the CBI, said: "The issue on everybody's lips in the financial services sector at the moment which is acting as a constraint on their businesses is the outlook for regulation. The number of people saying they don't know how it is going to affect their businesses reflects a high degree of uncertainty."
Complaints about regulation in the survey reinforce arguments made by Britain's bank bosses in recent weeks.
The banks are trying to water down plans for tougher rules by claiming their profitability will be hit – with an implicit threat to tax revenues and the Government's chances of selling stakes in state-supported banks.
Stephen Hester, chief executive of Royal Bank of Scotland, highlighted tighter regulation as the top threat to his bank's performance apart from.....Read more Here