Former Tory Chancellor Nigel Lawson has called for George Osborne to fully nationalise Royal Bank of Scotland (RBS) and criticised the bank’s so-called “star” traders.
Lord Lawson said he also believed there is a case for paying no bonuses at RBS this year, given the continued fallout from the LIBOR scandal.
The bank is expected to pay a fine running into the hundreds of millions for its role in the affair.
Speaking to the Financial Times, Lawson said RBS, currently 82% owned by the state, should be fully nationalised and turned into a lending vehicle to small businesses.
Lawson, who was Chancellor from 1983 to 1989, called on the government to withstand bank lobbying efforts to water down the proposed ring-fencing of retail assets.
He also criticised the previous Labour government's decision to appoint Stephen Hester as RBS chief executive.
"It is absurd to put a lifetime investment banker in charge of an entity which is overwhelmingly a retail and SME [small and medium enterprise] type bank," he told the paper.
The Labour leader may be 6/1 with Betfair to be the next PM, but what would an unlikely victory mean for financial services?
The Financial Conduct Authority (FCA) is considering raising the redress limit available to small business complainants from the Financial Ombudsman Service (FOS) above its current limit of £150,000.
Awards recognise firms that can showcase 'strong, transparent structures and procedures'
Search for external candidate
The FAMR isn't just 'another review', argues Sandringham chief