The Treasury Committee publishes an exchange of letters with HM Treasury concerning the set of amendments to the bank ring-fencing rules.
Commenting on the correspondence, Rt Hon. Andrew Tyrie MP, Chairman of the Treasury Committee, said:
"The proof of whether the current legislation, including these amendments, is consistent with an effective and credible ring-fence will become clear as it is implemented over the next two years. It is vital that the regulators and the Government remain alert to the risk of banks trying to game the ring-fence.
That is why the Parliamentary Commission on Banking Standards bolstered the Government's original ring-fencing proposals in 2013-14, by ensuring the regulators were granted the power to restructure banking groups if they were found to be undermining the ring-fence. There is also provision for an independent review of ring-fencing once it has fully commenced.
The regulators are now armed with the tools they said they needed. The job now is to deploy them well."