Vickers report calls for 10% capital buffer for banks

The final report from the Independent Commission on Banking has recommended UK banks' retail and wholesale arms be split off, and said the 7% capital buffers required under Basel III do not go far enough.

However, the Commission, chaired by Sir John Vickers, suggested giving banks until 2019 to implement the groundbreaking reforms, which could cost the banks up to £7bn to implement. The report, released today, suggests banks should have at least a 10% equity capital buffer to safeguard against losses. “The risks inevitably associated with banking have to sit somewhere, and it should not be with taxpayers,” the report said. It noted that under the international banking rules Basel III, banks must have equity capital of at least 7% of risk-weighted assets by 2019, and have no more than 3...