The Independent Commission on Banking has recommended UK banks' retail operations should be "ring-fenced" from their investment banking arms.
In its interim report, the commission also says Lloyds Banking Group should sell off more of its branches in order to increase competition on the high street, the BBC reports.
However, it falls short of recommending the separate arms within the banks should be completely split up, although it criticises lenders and borrowers for taking on "excessive and ill-understood risks" in the build-up to the financial crisis.
It also says the ring-fenced operations should hold more capital than currently required, suggesting a 10% core tier one ratio.
The report also suggests creditors not taxpayers should be liable for any losses.
Another recommendation is a requirement to set out details of charges and costs to customers of current accounts in a "much clearer and more comprehensible" way, with a deadline of seven days imposed on banks for transferring over customer information when someone moves his or her current account to a new bank.
It also says the new Financial Conduct Authority should have "a clear primary duty to promote effective competition".
Meanwhile, in the longer term, it says a new automated system for shifting a current account from one bank to another should be created, with a mechanism to enable customers to keep the same account numbers.
The commission's final report will be published in September.
First mentioned in Cridland Report
Second acquisition of 2019
Guy Opperman has rejected calls to speed up changes to auto-enrolment (AE) despite increasing pressure to boost contribution rates and overall savings pots.
Four key areas to focus on
And 94% for critical illness