Chancellor John Healey faces pressure from top British lenders this week to ease capital requirements, according to Treasury select committee chair Dame Meg Hillier. Speaking ahead of a Tuesday meeting at the Treasury, Hillier indicated that major banks including Barclays, HSBC, Lloyds Banking Group, NatWest Group, Nationwide, and Santander will complain about regulatory burdens impacting loan volumes. The gathering occurs amid speculation Healey may increase sector taxation, following his predecessor Rachel Reeves' decision against windfall levies.
Hillier noted the government had already granted banks "many of the things they asked for," urging regulators to be more growth-oriented. However, she stressed banks are seeking "more freedom on their capital," specifically asking the Bank of England to lower the countercyclical buffer from 2 per cent and change how software assets are treated. Building societies and mutuals are a particular focus, with Hillier arguing eased rules could boost lending to first-time buyers.
While acknowledging skepticism about loosening requirements post-financial crisis, Hillier emphasized the UK must remain competitive in the global market. Bank capital requirements are ultimately set by the Bank of England, which has already eased rules from a 14 per cent to 13 per cent tier one target. Executives want further relief via the chancellor's annual remit letter to the central bank.
Source: Financial Times Companies · Summarized by HeadlinesBriefing