Well, hallelujah!

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The EU and UK government have had an attack of commonsense. They’ve decided to flog off parts of Lloyds, RboS and Northern Rock to create new banks and both are said to be determined to see more competition in the market.
It’s much needed, as Professor Adam Posen, the newest member of the BoE’s MPC and Professor Charles Goodhart, former member of the Committee, have highlighted in the past week. Both have analysed the UK’s current situation and despite their different agendas, come to the same conclusion.
Unless the UK can shake up the banks and create effective international regulatory regimes, thereby freeing up sources of finance for business, the UK recovery will be vulnerable.
Posen warned of the dangers creating a double-dip recession and persistently slow growth. The peak to trough decline of this recession has exceeded that of the 1980s and the impact has been enormous.
The FD agenda changed overnight. The pressure is still on FDs to manage the effect of these new regulatory regimes, however they pan out; to continue exploring the different means of financing growth and how they deal with banks: and not least, to source services more effectively and cut costs wherever possible.

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