The Independent Commission on Banking’s interim report for reforming the U.K. financial system has called for large banks such as HSBC and Barclays to hold additional capital to ringfence their retail units to protect them from riskier investment-banking operations. The report suggested a 3% equity surcharge above the capital requirements adopted by the Basel Committee on Banking Supervision. The ICB stopped short, however, of calling for the break-up of banks. John Vickers, the former head of Bank of England who led the ICB, denied reports that his commission was soft on banks.
