Bank of England Governor Mervyn King says failure to act now on banking reforms could lead to a bigger financial crisis.
Giving evidence to cross-party commission on the future of the banking industry, King also stressed his opposition to having firms deemed "too big to fail." This was because of the potential cost to the taxpayer if they needed to be bailed out, reports Reuters.
"My fear would be, we have had this debate and we will set out possible alternative models for the structure of banking, but not very much will happen," King says.
"It will not actually prevent the next crisis - the next crisis will be even bigger."
"One of the consequences now with the implicit subsidy of too important to fail is there is an advantage to being not so much large in terms of size but large in terms of scope."
"So you really want to have a big link to the payments system of retail deposits and a lot of other things because you know the government cannot afford to let you go under. We need to get rid of it."
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From 6 April 2019