UK Government Publishes Response to Vickers
Date: 19 December 2011
Source: HM Treasury
The UK Treasury has published its response to the recommendations of the Independent Commission on Banking. It will introduce the ring-fence, with large ring-fenced banks to hold at least 10 percent equity capital. Further, the UK operations of British banks, and the non-UK operations of UK-headquartered banks which pose a threat to UK taxpayers, must hold at least 17 percent loss absorbing capital. Depositor preference will be introduced, although the Government will consult on this. The Financial Conduct Authority is to have a mandate to promote competition in the interests of consumers. The UK Chancellor also announced that legislation for the ring-fence will be separated and brought forward, with legislation to be completed in 2015, and banks to comply “as soon as practically possible thereafter.”