Barclays warns of consolidation

first_img Barclays warns of consolidation BARCLAYS president Bob Diamond yesterday predicted that the avalanche of new financial regulation will spark a wave of consolidation across the banking sector, as struggling banks are swallowed up by more successful rivals.Diamond, answering questions from delegates at the CBI’s annual conference, said that higher capital requirements in particular would mean that banks will increasingly have to focus their efforts on generating adequate returns rather than on growing their businesses.But he said that the tougher environment would have the added effect of widening the gulf between the “winners and the losers” among the banks.“That means we’ll see significant consolidation across the European banking sector going forward,” he said.Diamond’s view was echoed by the CBI’s Richard Lambert, hosting his last conference as director-general before stepping down from the role next year.“We will increasingly see a trade-off between stability and competition in the banking sector,” Lambert told City A.M. on the sidelines of the conference. “Regulation will make it even harder for new entrants to the banking market. Only one new bank has opened on the UK high street in the past 100 years and I am not expecting any more to arrive any time soon.”Lambert’s comments come at a time when numerous potential new entrants have gone quiet on plans to enter the banking market, including Virgin Money and Walton & Co – the brainchild of Panmure Gordon banking analyst Sandy Chen.Only Metro Bank – backed by US retail banking tycoon Vernon Hill – has actually gone ahead with a high-profile opening.In addition, two of the City’s most high profile veterans, Lloyd’s of London boss Lord Levene and David Walker, who led a review of corporate governance in the bank sector last year, are also looking to set up a vehicle to buy up UK banking assets. The venture has been given the working title of “Project New Bank”. KCS-content Monday 25 October 2010 7:39 pm Show Comments ▼ More From Our Partners Russell Wilson, AOC among many voicing support for Naomi Osakacbsnews.comAstounding Fossil Discovery in California After Man Looks Closelygoodnewsnetwork.org980-foot skyscraper sways in China, prompting panic and evacuationsnypost.comNative American Tribe Gets Back Sacred Island Taken 160 Years Agogoodnewsnetwork.orgBiden received funds from top Russia lobbyist before Nord Stream 2 giveawaynypost.comPolice Capture Elusive Tiger Poacher After 20 Years of Pursuing the Huntergoodnewsnetwork.orgKiller drone ‘hunted down a human target’ without being told tonypost.comBrave 7-Year-old Boy Swims an Hour to Rescue His Dad and Little Sistergoodnewsnetwork.orgA ProPublica investigation has caused outrage in the U.S. this weekvaluewalk.com whatsapp whatsapp Tags: NULL Sharelast_img

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