UK banks face more profit pressures, job cuts: KPMG
LONDON -- Britain's banks face more pressure on profits, partly because of increasing regulation costs, and many will have to cut more jobs, according to a study by accountancy firm KPMG.
KPMG said work on implementing proposals by Britain's Independent Commission on Banking for lenders to boost capital ratios and protect retail banking arms from investment banking divisions would soon have an impact.
“The cost of regulation is starting to bite and this will not ease off anytime soon, especially as work on implementing the Independent Commission on Banking recommendations and recovery and resolution plans heats up,” said Bill Michael, UK head of financial services at KPMG.
“With interest rates at a historic low in the UK, banks continue to face intense pressure on liability margins with stiff competition for deposits to improve funding. Non-interest income has remained broadly flat compared with 2010,” he said.
“Against this backdrop, future profitability is a key concern for retail banks and I anticipate additional price increases for customers. Further job cuts are also inevitable.”
Britain's banking sector is dominated by the so-called “Big Four” of Barclays, HSBC and part state-owned lenders Lloyds and Royal Bank of Scotland .
Britain owns around 40 percent of Lloyds and 82 percent of RBS and after bailing them out during the 2008 credit crisis.
Lloyds and RBS both reported hefty losses for 2011 in February.
|Copyright © 1999 – 2016 The China Post.|
|Back to Story