Make bank reforms law now, insists Sir Mervyn

Bank of England governor Sir Mervyn King said yesterday that banking reforms should be passed into law as soon as possible to prevent the plans being watered down.

The bank boss hinted he would have preferred a complete separation of retail and investment banking, rather than the ring-fencing proposed by the Vickers commission.

But he said the plans were “the game in town” and should be enacted quickly to “prevent further lobbying to water down the proposals”.

His comments come in response to the interbank rate-­rigging scandal.

He said the affair highlighted differences in culture between retail and investment banking and confirmed the importance of splitting the two.

Sir Mervyn declined to comment on yesterday’s revelations that he told Barclays chairman Marcus Agius that Bob Diamond no longer had the support of his regulators. .

Sir Mervyn also offered little cheer on the economy, saying that it “doesn’t show a great
deal of signs of impending
recovery”.