Revamp ‘may cost banks £15bn a year’
The figure is contained in a confidential analysis done on behalf of the banks by management consultants Oliver Wyman. The analysis has been submitted to the Government’s Independent Commission on Banking (ICB).
The report estimates the annual cost of so-called subsidiarisation to be between £12 billion and £15 billion a year.
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Hide AdDetails of the analysis come three weeks before the ICB produces its interim report on the future of Britain’s banking sector.
Leading players including HSBC, Barclays and part-nationalised Royal Bank of Scotland fear the ICB would recommend distancing the retail and investment arms of such universal banks, forcing them to have different capital structures.
Mervyn King, Governor of the Bank of England, argued in a recent interview that the “too big to fail” question had still not been resolved.