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Shares soar on talk of Vickers reforms delay

 

Andrew Grice
Friday 02 September 2011 00:00 BST
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Bank shares soared yesterday amid growing signs that plans to ring-fence their retail and investment operations will be delayed until at least 2015.

Royal Bank of Scotland shares rose 6 per cent to 25.8p, while Barclays was up 5 per cent at 179p and Lloyds rose 4 per cent to 35.1p.

As The Independent reported yesterday, David Cameron and the Chancellor, George Osborne, are sympathetic to the banks' pleas to be given several years to erect the "firewalls" to be recommended by the Independent Commission on Banking on 12 September.

A long delay has been opposed by the Liberal Democrats. But the Coalition is heading towards a compromise under which the legislation would be passed before the next general election, due in 2015, but would not take effect until afterwards.

UK Financial Investments, which manages the taxpayers' stake in Lloyds and RBS, is said to have warned the Chancellor that implementing the proposed reforms before 2015 could hit the value of its investments by between £5bn and £10bn.

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