The UK Parliament has passed the banking reform bill, approving it on the evening of 16 December.
The bill passed through the House of Lords, the second chamber of the UK Parliament, marking the end of a three year process and will now need to receive the Queen’s approval before passing into law. As part of the reform, the banks will be forced to separate their retail and investment operations and senior bankers will be subject to a licensing regime.
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Lord Deighton of the Conservative party, who opened the debate discussing the bill, said: "The heart of the new regime is that the banks cannot hide behind the regulator in enforcing standards.
"The independent regulator will be central to this new regime but will, instead of doing the banks’ job for them, be more properly focused on setting the standards of conduct, determining the significant-harm functions, deciding the necessary qualifications and, crucially, holding banks to account for their compliance with the regime."
Lord Tunnicliffe, for Labour, said: "We are in but, we hope, moving towards the end of the worst financial crisis in most of our lifetimes.
"We will not agree on the reasons for this crisis, as we have proved when we have touched on it over the past several months.
"However, I think all noble Lords agree that some part of it related to the regulation and structure of the banking sector."
Tunnicliffe praised the work of the Parliamentary Commission for Banking Standards, the body that reported on standards in the UK banking industry and recommended new legislation.
He said: "My parliamentary experience is not long enough to be sure, but I think the Parliamentary Commission on Banking Standards is an innovation.
"It has been a good one, roundly approved by all sides of the House and I thank its members, two of whom are in their place tonight."
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