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U.K.’s ‘Moderate’ Bank Report Calls for Extra Capital, Sales

The Independent Commission on Banking recommended the U.K.’s biggest banks should boost capital, implement plans for an orderly bankruptcy and erect fire breaks around their consumer units in what it called “moderate” proposals.

The commission acknowledged the concerns of some banks, including Barclays Plc, by shying away from an enforced separation of investment banking units in its 208-page interim report published today. The largest banks should have a core Tier 1 capital ratio, a measure of financial strength, of at least 10 percent, the commission said. It also called for Lloyds Banking Group Plc, the country’s biggest mortgage lender, to divest “substantially” more branches than the 600 already being offered for sale to meet European Union state aid rules.