British view on international regulation is labelled chaotic

SENIOR City figures lashed out at the government’s approach to financial regulation yesterday, saying that its failure to take into account international initiatives is causing chaos.

Responding to City A.M.’s revelation yesterday that major parts of the coalition’s flagship banking policy could be ruled illegal by the EU (see inset), Clifford Chance partner Simon Gleeson said: “The problem is that the UK still has a tendency to think of financial regulation as if it had a free hand… It would be better for all concerned if we played within the rules we have rather than playing fantasy football with powers we gave away a long time ago.”

Mark Field, Tory MP for the City, agreed the process has been messy: “None of this has been properly thought through. How much of the Vickers report will see the light of day I don’t know.”

Eversheds partner Michael Wainwright said that the battle on the Vickers Commission and capital rules “is effectively a power struggle” with Brussels, adding that it is not even clear what powers the UK has. “The idea of repatriating powers seems a bit of a pipe dream,” he added.