Banking Reform

Diana Johnson Excerpts

Monday 4th February 2013 Commons Chamber

[Greg Clark]

My hon. Friend is right, but I think we have already had the intelligent debate. The Government asked the commission to look into that issue in particular and to make recommendations, and the commission expressed the interim view that it was reasonable—as my hon. Friend says—for simple derivatives to be provided from within a ring-fenced bank. However, it wants to reflect further on whether any of its inquiries into the culture of banking may have implications for that. We will await its conclusions.

[Diana Johnson (Kingston upon Hull North) (Lab)]

Following the bank mergers, many regional banks and building societies have gone, and we have lost the investments that they would have made at local level. Will the Minister explain how the Bill will enable areas such as Yorkshire to benefit, and can he assure us that it will not be just the south-east that benefits from the increase in the number of banks?

[Greg Clark]

The hon. Lady makes an excellent point. I should like very much to see banks in our great regional cities, as used to be the case: banks that can take deposits from local people and, knowing what local investment opportunities they have in the area, can establish a connection. So far it has been very difficult for new banks to obtain banking licences within a reasonable period, and to satisfy the regulatory requirements. We are doing all that we can to lower the barriers to entry, so that we can achieve exactly what the hon. Lady has described.