Britain is set to pass a bill that will separate risky investment and retail banking, protecting lenders from multibillion dollar investment banking losses. Experts fear, if the deal is approved Monday, it’ll be the end of “free” retail banking.
The Banking Reform Bill is a response to the critical flaws in the UK financial system exposed by the 2008 financial collapse, and the 2008 Libor scandal.
‘Fenced’ banks will no longer be able to offer clients certain derivative products and trade financial services that are deemed ‘too risky’ by the legislation. Retail and investment banking operations will be split, to prevent such gambling, but some worry it could spell the end of ‘free banking’.
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Lucas 2012 Infos 