Leading UK banks, including HSBC Holdings, Lloyds Banking Group, NatWest Group, and Santander UK, have collectively urged the UK Chancellor, Rachel Reeves, to abolish the "ring-fencing" policy that separates retail banking from riskier investment banking. The CEOs argue that this policy hampers banks' ability to support businesses and the economy, deeming it unnecessary.
Introduced after the global financial crisis, the "ring-fencing" rules aimed to protect consumers by separating retail banking from investment banking. However, banks have long criticized these regulations as overly burdensome, claiming they hinder the UK's competitiveness against other global financial centers.
In their letter to Reeves, the bank leaders emphasized the importance of removing unnecessary restrictions to enhance the financial services sector's growth and competitiveness. They believe this reform would send a strong signal to investors about the government's commitment to economic support and growth.
The CEOs consider the removal of the "ring-fencing" policy a crucial step for maximizing the banking sector's ability to support UK businesses and drive economic growth.
