June 4 (Bloomberg) -- Barclays Plc Chief Executive Officer Antony Jenkins said new entrants to Britain’s consumer-banking market will find it hard to win market share as the Co-Operative Bank Plc struggles to meet regulatory capital targets.
“The Co-Op is a great example of a worthy institution with a lot of longevity in the U.K. that’s found that banking is quite challenging,” he said at the Deutsche Bank Global Financial Services Investor Conference in New York today. Tighter regulation is making consumer banking “tough,” Jenkins said.
Co-op, which traces its roots to Britain’s 19th-century industrial north, had its credit rating cut six steps by Moody’s Investors Service on May 9, which cited a capital shortfall for its decision. Co-Operative Bank’s core Tier 1 capital ratio under the latest round of Basel rules was 6.7 percent in January, less than the 7 percent target of financial strength set by U.K. regulators, Moody’s said.
Chancellor of the Exchequer George Osborne has pledged to make it easier for new banks to get approval to operate. Britain’s Prudential Regulation Authority, responsible for bank supervision, will let new lenders trade with a capital ratio as low as 4.5 percent, the minimum allowed under global standards, in an attempt to revive banking competition, it said in March.
Britain’s four largest banks have about 75 percent of the checking account market, the Office of Fair Trading said in January.
-- Editor: Jon Menon
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