U.K.’s Competition Body Weighs Banking Sector Probe by Year-EndGaspard Sebag
The U.K.’s future competition authority will decide before year-end whether to conduct a investigation of banking services for smaller companies and retail customers.
“There appear to be important similarities between competition issues for personal current account customers and for SME customers,” the Office of Fair Trading said today in an e-mailed statement.
The Competition and Markets Authority, which will start operating as the lead U.K. competition body next month, plans to take a provisional decision on the matter “during summer” and a final position “during autumn,” according to the statement.
To reach a decision the CMA will take over and finalize the OFT’s market study into banking for small- and medium-sized enterprises and update last year’s review of personal accounts, according to the statement. The CMA’s work will take into account developments such as planned divestments by Lloyds Banking Group Plc and the Royal Bank of Scotland Group Plc of their retail banking businesses.
The CMA’s further investigation of the U.K.’s banking sector is “a welcome development -- but it must deliver results,” John Longworth, director general of the British Chambers of Commerce, said in an e-mailed statement.
“While some progress has been made in recent years, including the new account switching service for businesses, greater competition is required to ensure that business customers across the U.K. are presented with a real choice on the type of finance offered, lending rates, terms and conditions, and level of service,” Longworth said.
RBS and Lloyds didn’t immediately respond to requests for comment.