Mr Miliband said he would like to see Britain’s top five high street banks broken up and forced to sell up to 1,000 branches to pave the way for two new privately-run challenger banks in the sector.
“We need a revolution in British banking,” he said.
Lloyds Banking Group is already selling off more than 600 branches, with the Co-operative Bank currently in exclusive talks to form what would amount to one of the challenger banks.
The opposition leader also wants a new code of conduct for banks, which would be supervised by an organisation similar to the British Medical Association.
In addition, Mr Miliband wants to see a specialist banking unit set up with the Serious Fraud Office to tackle the “weak and fragmented” approach to fraud investigations.
Shadow chancellor Ed Balls said the banking sector needed a “root and branch review”, but the government was “dragging their feet”.