(Reuters) – HSBC Holdings Plc (HSBA.L) is urging Britain to delay its deadline for new rules forcing lenders to separate routine retail operations from riskier investment banking activities, until the outcome of an industrywide probe, Sky News reported on Sunday citing sources.
HSBC Chairman Douglas Flint has written a letter to UK Chancellor George Osborne and Bank of England Governor Mark Carney requesting a delay to the 2019 timetable for banks to ring-fence their business, Sky quoted sources familiar with the letter’s content as saying. (bit.ly/1o3jfH9)
UK lawmakers in December gave their final approval to reforms aimed at tackling structural failings at banks, that came to light following the 2007/8 financial crisis and a series of mis-selling and rate-fixing scandals.
The main feature of the bill was a rule to force banks to separate their retail and investment activities.
Following the government’s decision, Britain’s competition watchdog in July said it would most likely launch an 18-month long in-depth investigation into bank services for small business customers and personal accounts later this year because of a lack of competition in the industry.
Sky said HSBC was concerned that the UK’s Competition and Markets Authority (CMA) could call for structural reforms, including a disposal of operations, on which it is already spending significant sums in preparation for the introduction of ring-fencing rules.
CMA, which has the power to order a break up of banks considered too dominant, will decide in autumn whether to launch the full investigation.
HSBC could not immediately be reached for a comment outside of regular business hours in the UK.
Prudential Regulation Authority Chief Executive Andrew Bailey, and Andrew Tyrie, chairman of the Treasury Select Committee and Parliamentary Commission on Banking Standards (PCBS), had also received Flint’s letter, Sky said.