The government just announced one of the most significant revisions to banking regulation in more than three decades. It claims that the more than 30 measures included in the package will “reduce red tape” and “turbocharge growth.”
There will be a reassessment of the regulations that required banks to legally divide retail banking from riskier investing businesses. These were put in place following the 2008 financial crisis, when several banks were in danger of failing.
According to Chancellor Jeremy Hunt, sweeping financial services reforms in the UK should be the first step in a 20-year plan to make the country the new Silicon Valley.
Hunt claimed the proposals will increase the country’s global competitiveness, draw investment, and advance the government’s vision for Britain as an innovation hub shortly after the regulatory revamp was revealed.
The set of modifications, known as the “Edinburgh Reforms,” is cited as an illustration of the ability to particularly tailor law to the requirements and strengths of the UK economy following Brexit.
The government is expected to unveil modifications to the ring-fencing regulations, which presently force giant banks to separate their retail and investment units, while also vowing to safeguard consumers.
Regarding the multi-trillion-pound insurance industry, Mr. Hunt promised to alter Solvency II in his autumn statement, which will loosen the sector’s capital requirements.
The Chancellor is also anticipated to grant new mandates to the Financial Conduct Authority and the Prudential Regulation Authority to guarantee that both help “promote the international competitiveness of the UK.” The Treasury stated that reforms will expand on that commitment.
Source: The Britonian