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NWG Natwest Group Plc

265.50
2.70 (1.03%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Natwest Group Plc LSE:NWG London Ordinary Share GB00BM8PJY71 ORD 107.69P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  2.70 1.03% 265.50 265.80 265.90 266.60 263.70 265.00 25,164,662 16:35:01
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Commercial Banks, Nec 14.77B 4.64B 0.5271 5.04 23.38B

U.K. to Probe Retail Banking Sector

18/07/2014 11:57am

Dow Jones News


Natwest (LSE:NWG)
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LONDON--The U.K. antitrust authority said Friday there should be a competition probe into checking accounts and small-business banking markets, a decision that will create further uncertainty about the future shape and size of Britain's largest banks.

In a report, the Competition and Markets Authority said essential parts of the U.K. retail banking sector lack effective competition and don't meet the needs of personal consumers or small and medium sized businesses. The competition body is now consulting on its provisional decision that there should be an in-depth investigation into the markets. A final decision is expected in the autumn.

If the CMA eventually finds the British banking market lacks competition it can recommend banks are broken up or regulations changed.

The U.K retail and business banking is dominated by four banks: Lloyds Banking Group PLC, Royal Bank of Scotland PLC, Barclays PLC and HSBC Holdings PLC. These banks control 77% of the checking account market and 90% of business loans, the CMA said.

In recent years the U.K. government has pushed for greater competition in the U.K. banking market in the hope that a more vibrant sector will pump more credit into the economy. So far the efforts have yet to bear fruit. Although several smaller banks have opened their doors in the last two years, none have the heft to take on the so-called "Big Four."

"Our provisional view is that a full market investigation by an independent, expert CMA group is necessary to look at this market in detail and identify appropriate measures if competition concerns are found," said CMA Chief Executive Alex Chisholm.

The announcement of an inquiry will put particular pressure on Lloyds, which currently controls one in four of the U.K.'s checking accounts.

The British Bankers Association, a bank lobby, has argued that a review isn't needed because the sector is undergoing a technological transformation as customers increasingly bank online. Last year banks teamed up to create a system that allows customers to switch checking accounts to competitors in seven days. Meanwhile, British regulators are making it easier for companies to apply for banking licenses.

As part of its consultation the CMA will listen to proposals by banks on how they could increase competition in the small business lending market. These include setting up a price comparison website and putting in place rules that make it easier for businesses to move their accounts between banks.

Write to Max Colchester at max.colchester@wsj.com and Razak Musah Baba at Razak.Baba@wsj.com

Subscribe to WSJ: http://online.wsj.com?mod=djnwires


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