The managing director of prudential
regulation at the Financial Services Authority (FSA),
Andrew Bailey, has publically backed the need for powers to
separate trading activities into separate legal
During a speech at a Bank of America Merrill Lynch
conference in London on November 6, Bailey addressed the
challenges in assessing capital requirements for banks.
The Independent Commission
on Banking (ICB), headed by Sir John Vickers, last year
proposed a banking ringfence that would require major
European banks to build a firewall between consumer and
As Paul Volcker recently pointed out,
customer banking involves a fiduciary duty, whereas trading
with counterparties does not, said Bailey, addressing the
But Bailey gave an important caveat: the fiduciary duty of
customer banking was...