UK’s Osborne to unveil future of state-controlled banks
British lawmakers have called for new laws to make it easier to jail reckless bankers
The fate of Britain’s two state-controlled banks will become clearer on Wednesday, when finance minister George Osborne is likely to start the clock ticking for the sale of the government’s stakes.
But while Osborne will attempt to point to a healthier future for Britain’s economy and banking sector in his annual speech to financiers in the evening, reminders of recent troubles will not be far away.
An influential panel of legislators called for new laws on Wednesday to make it easier to jail reckless bankers. Speaking alongside Osborne will be Bank of England Governor Mervyn King, whose disdain for investment banking is clear.
Moreover, although Britain’s economic recovery looks to be on a firmer footing than a few months ago, it is still sluggish and vulnerable to a global slowdown, and would benefit from a banking industry better-placed to support business investment.
Britain’s previous Labour administration pumped 66 billion pounds (HK$802.2 billion) of public money into Royal Bank of Scotland and Lloyds Banking Group in 2008 to save them from collapse at the height of the global financial crisis.
Osborne’s Conservative-led government has pledged to return them to the private sector, but has not set a date - something which should change later on Wednesday when he speaks at Mansion House, the Lord Mayor of London’s grand official residence.