Belfast Telegraph

What the ICB plans are all about

Q: What is the ICB? A: Chancellor George Osborne created the ICB in June 2010. The commission was asked to consider reforms to the UK banking sector to promote financial stability and competition. The commission made a series of recommendations in its final report.

Q: What has the ICB proposed? A: The ICB has made recommendations in three key areas: the retail ring-fence; loss-absorbency; and competition. The retail ring-fence will protect everyday high- street banking services, such as current account deposits, from riskier investment divisions. Ring-fenced banks should be separate legal entities, the commission added, and have an independent board.

Q: What is ring-fencing? A: Ring-fencing involves banks splitting their retail arms - that is their high-street operations and activities - from investment banking. Both would function as separately funded subsidiaries. The retail arm could then be salvaged if the rest of the more-risky investment bank goes bust.