THE foreign exchange scandal showed the need to maintain pressure on the Government and regulators to implement plans to shake-up the banking sector, the chairman of the Treasury Select Committee has said.
RBS was among six banks fined a total of £1.1 billion by the Financial Conduct Authority last week for failing to control their forex operations. The Edinburgh-based part-taxpayer owned bank was fined £217 million for its role in the affair.
Andrew Tyrie MP and his fellow former members of the Parliamentary Commission on Banking Standards (PCBS) warned that the programme of reform they put forward must not be watered down.
He said the "appalling misconduct" in the forex market exposed how much work is needed to improve standards in the City.
Mr Tyrie's comments came as the Treasury Select Committee and former members of the PCBS reported on the implementation of the commission's work.
The Tory MP said: "These reforms are badly needed to tackle serious lapses in banking standards and a collapse of trust in the industry.
"The commission's wide-ranging recommendations - on the structure of banking, individual responsibility, regulation, corporate governance, remuneration, competition and enforcement - offer a much better prospect of protection for both the taxpayer in a subsequent crisis, whenever that may come, and for consumers against future bank misconduct.
"But they need to be fully implemented."
Mr Tyrie said the commission's proposals for ring-fencing banks' retail operations to keep them apart from risky investment arms were "particularly vulnerable".
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