Royal Bank Of Scotland (LSE:RBS)
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Royal Bank of Scotland Group PLC (RBS.LN) Chairman Philip Hampton said that plans to ring-fence its retail operations from the more risky investment banking arm could be "expensive" and said the bank will pass on costs to business and household customers, according to an interview in the Sunday Telegraph newspaper.
In the interview Hampton said the U.K. government's plans to force all banks to separate their retail operations from "casino" investment banking activities would pile more costs on to the entire system which "somebody had to pay for."
In last week's Queen's Speech, the Government confirmed it intends to introduce the Banking Reform Bill, drawing on the work of the Independent Commission on Banking, which called for the separation of retail from investment banking operations.
"What the banks want to make sure of is that it's not introduced in a way that is too expensive, because if it's expensive then either taxpayers will suffer in our case, or customers will suffer, because we'll have to eventually deal with our costs and reclaim some of our costs from customers," he is quoted as saying.
Hampton said ring-fencing could end up increasing the squeeze on consumers and cash-strapped businesses as banks worked out how to recoup costs, the paper reports.
He also said RBS would have to "get more efficient as well", raising the possibility of more job losses at the 82%-state-owned bank, the paper says.
Newspaper website: http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9262281/RBS-boss-customers-will-have-to-pay-for-ring-fencing.html
-London Bureau, Dow Jones Newswires; +44 (0)20 7842 9320