Government to raise £2.5bn through bank levy

The Governmnet said it expected to generate around £2.5bn of annual revenues by 2012-13 via a permanent levy on banks' balance sheets.

The figure was in line with a forecast made when the levy was announced in the budget in June.

The government has now published draft legislation on a levy which will take effect on January 1, 2011 and is intended to encourage banks to move to less risky funding profiles following the credit crisis.