Background to structural reform
The global financial crisis revealed the need for fundamental changes to how banks are run. In response, the Government developed legislation to require UK banks to separate the provision of core retail services from other activities within their groups, such as investment and international banking. These requirements are known as structural reform or ring-fencing.
The aim of structural reform is to protect UK retail banking from shocks originating elsewhere in the group and in global financial markets. Structural reform is a key part of the Government’s package of banking reforms designed to increase the stability of the UK financial system and prevent the costs of failing banks falling on taxpayers.
For an overview of ring-fencing and how it will affect you, please see the Knowledge Bank article 'Why are retail banks being 'ring-fenced' and how will this affect me?' and 'Ring-fencing: what is it and how will it affect banks and their customers?' Quarterly Bulletin 2016 Q4.