Particle.news
Download on the App Store
3 ARTICLES
·
last wk.

UK Treasury Signals Openness to Ring-Fencing Reforms as NatWest Privatization Nears Completion

Chancellor Rachel Reeves has expressed willingness to explore changes to the post-crisis banking regime, with a potential policy announcement expected in July.

Image
The Bank of England’s watchdog is under pressure from lenders who argue the rules are inefficient and have been supplanted by other reforms

Overview

  • Chancellor Rachel Reeves has told major bank CEOs she is open to further reforms of the ring-fencing regime, which separates retail and investment banking operations.
  • The Treasury and the Prudential Regulation Authority are actively reviewing the regulatory framework, with discussions underway between officials and bank representatives.
  • HSBC, Lloyds, NatWest, and Santander have urged the government to abolish ring-fencing, claiming it imposes inefficiencies and restricts lending, while Barclays defends it as essential depositor protection.
  • Analysts estimate that scrapping ring-fencing could save banks up to £2.5 billion, with NatWest positioned to gain the most from reduced funding costs.
  • The government’s stake in NatWest has dropped below 1%, with the final sale expected imminently, marking the near-completion of its exit following the 2008 bailout.