Shadow chancellor John McDonnell says a Labour government under Jeremy Corbyn would break up the big banks

Lauren Fedor
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Shadow chancellor John McDonnell said small businesses "face dreadful difficulties" when trying to get funding (Source: Getty)

A Labour government led by Jeremy Corbyn would look to break up Britain’s biggest banks, shadow chancellor John McDonnell has said.

Speaking at a Co-operatives UK conference in Manchester today, McDonnell said: “Small businesses in general, and not just co-operatives, face dreadful difficulties in getting the funding they need from our high-street banks.

“No other major developed economy has just five banks providing 80 per cent of loans.

“We’d look to break up these monopolies, introducing real competition and choice. Regional and local banks, prudently run and with a public service mandate, have to be part of the solution here.”

Former Labour leader Ed Miliband also pushed for a total restructuring of the banking sector, pledging in 2014 to break up the biggest banks in favour of creating at least two new competitors.

The Competition & Markets Authority (CMA) rejected suggestions for breaking up big banks last year, saying the proposals were “not likely to be addressing competition concerns”.

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