Bank chiefs oppose splitting up banks

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Outgoing Chief Executive of Lloyds Banking Group, Eric Daniels, has today said he is opposed to the proposal of splitting up Britain’s banks, arguing that it will not enhance competition within the sector.

Meanwhile, chief executive of Royal Bank of Scotland (RBS), Stephen Hester, agreed and said breaking up banks won’t improve the outcome for consumers.

Many experts have argued that it could damage the UK’s reputation as a global financial centre.

Today, Mr Daniels told Treasury Select Committee: “This is an enormously competitive market and I’m not sure that dividing banks further would give a better outcome.

“Concentration does not lead to lack of competition,” he added.

The comments come as Britain’s Independent Commission on Banking (ICB) is looking at ways to increase competition and choice among high street banks and one option could see existing banking giants broken up and new names enter the industry.

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