Reforming the structure of the EU banking sector
Delivered in Plenary - 3 July 2013
The UK’s banking sector is a national asset and London, the EU’s largest financial centre. The financial services industry contributes approximately 10% of UK GDP, with every job in the sector adding around GBP 117 000 to my London constituency’s regional economy and representing about 50% of it. However recent reckless behaviour has heightened awareness of the sector’s need for prudential reform, but we must preserve, and also enhance, the banks’ ability to finance the wider economy, particularly SMEs, in order to create jobs and growth in our economy.
I am supportive of this report’s aspiration for a principles-based approach to protecting taxpayers and bank customers when part of a bank fails and needs formal resolution. I welcome its desire to complement other banking reform measures with its proposals. In the UK I support the Vickers banking reforms and would personally go further by advocating a formal separation of retail and wholesale banking, along the lines of the US Glass-Stegall Act, to prevent another 2008 financial collapse occurring in the West.