Mike works on financial policy at Cicero Consulting. He has previously worked on political campaigns in both the UK and US, including the presidential election in 2004.
George Osborne has announced widespread acceptance of the recommendations of Sir John Vickers and the Independent Commission on Banking.
The whole process of banking reform has required an award-winning balancing act performance by the Chancellor, and undoubtedly Vickers too.
While Conservative desires to implement deep and lasting reform in the sector are absolutely genuine, the Lib Dems – and particularly the man long-associated with banker bashing, Vince Cable – desperately need to show their electorate that they have forced the ‘City-cosy’ Conservatives to come down hard on the banks. And, crucially, in this Parliament.
The Vickers proposals satisfy both these aims, which is why the Chancellor is almost universally adopting the recommendations.
We will see real and hard reform to the sector – most notably in the acceptance that UK banks will be forced to ring-fence their retail arm from their investment banking divisions, which Barclays Chief Executive Bob Diamond this weekend said would cost the banking sector £7bn.