The Bank of England has released a report which outlines sweeping proposals to bring British banks under control.
The Bank’s quarterly Financial Stability Report calls for an end of “too-big-to-fail” and “too-complex-to-regulate” banks.
But it will take difficult and controversial measures that are unlikely to be popular with banks to achieve this.
Mervyn King has made it clear that regulating the banking system is a priority, but that it is going to take time.
He told the Treasury Select Committee earlier in the week that he and his team still do not know what should be done; defining “regulation” in a modern banking context is proving tricky