Ring-fencing would cut bank profits by 15pc, says Morgan Stanley
Originally posted by 5corpio

Proposals to ringfence large parts of the operations of UK-based banks could reduce their pre-tax profits by as much as 15pc within three years, according to Morgan Stanley

Morgan Stanley analysts estimate that Royal Bank of Scotland will be most affected by the changes and say ring-fencing could cost the lender about £1.4bn a year by 2014, or about 15pc of its forecast pre-tax profits. Barclays could take the second biggest hit of any British bank and the estimated annual cost of ring-fencing its UK retail operations would be about £1.4bn within three years, or a 12pc reduction in pre-tax profits.


The analysis by Morgan Stanley shows the high costs of forcing banks to operate their UK retail and small-and-medium sized corporate banking businesses as a ring-fenced subsidiary that could be seized by the...Read more ---> CLICK HERE