05, February 2013

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GBP/USD (a 4-hour chart)

The head of the UK Treasury, George Osborne announced on Monday new powers for regulators to share banks that violate the rules to fencing retail banking from riskier investment banking activities.

We are talking about the banking Bournemouth, England. Mr Osborne said that the new powers are necessary to avoid the taxpayer getting on the bank hook when banks fail, as it often happens during the financial crisis.

News that regulators will be given additional powers of a reserve came after the parliamentary committee on banking standards in December made a decison that the Government's bill does not enough protect investors and more drastic measures may be needed to ensure the stability of the financial systems.

Commission, which was created in the wake of the scandal surrounding the falsification of the London Interbank Offered Rate, or Libor, said that the banks may resist to this bill.

It is recommended to give the regulators the power until the complete separation of retail banking and investment, breaking parent organizations.

The decision of Mr. Osborne to approve the recommendation of the Commission is likely to receive criticism from the banking sector.

The industry argued that the regulator, providing complete separation may create uncertainty, which in turn could hit on international investment and undermine the reputation of London as a leading financial service centers.

However, Mr Osborne said on Monday that the government has no choice but to make the tough decisions that are good in the long term for the UK.

On Monday the government submitted a bill banking reform legislation, which is the basis for the separation of banking and regulatory powers. Mr Osborne said that he hopes it will be passed into law in February 2014.

The government also has a strict line against the banks for alleged falsification of interbank lending rates. Much of the state of the Royal Bank of Scotland may have to cut its bonus pool for alleged falsification of Libor. RBS, is expected to pay about 500 million pounds ($ 785 million) in fines.