Overview
- Badenoch, speaking at TheCityUK conference on Thursday, offered three headline policies: end ring‑fencing that separates retail and investment banking, reduce capital buffers for lenders, and abolish the Financial Ombudsman Service.
- She claimed those measures could unlock about £450 billion for investment and said laws would be changed so regulators must consider competitor jurisdictions when setting rules.
- Senior industry figures responding publicly welcomed the plan, with TheCityUK’s chief executive and former Bank of England deputy governor describing the proposals as a valuable contribution to the debate.
- Practical hurdles remain because the Bank of England’s Financial Policy Committee currently sets capital requirements and cut a cited minimum from 14% to 13% at the end of 2025, so legal and regulatory change would be needed to alter that remit.
- Labour criticised the package as political positioning and noted Badenoch could have pursued some changes when she was business secretary, while analysts warn lower buffers and looser separation could raise risks for consumers and deposit security.