IMA has published its response to the Turner Review. The key points include:  

  • a Glass-Steagall statutory separation of utility and commercial banking is unlikely to be practical but that many of its benefits could come from better calibrated capital requirements for banks' trading activities. Also capital requirements could encourage risklimiting business models;  
  • there should be low barriers to capital market entry to encourage new intermediaries;  
  • reform should address the fact the banking sector is now more concentrated than it was;  
  • regulation should recognise the specific needs of prudential regulation for limited licence investment management firms, notably the areas where there is little or no risk while the banking sector carries significant risk;  
  • there must be proper, permanent representation of the asset management industry on the ESRC;  
  • there should not be over-reaction to the way in which passports work based just on the Icelandic banking failures;  
  • the new powers for the 3L3 committees should help guard against unwelcome gold-plating of Directives; and  
  • the US proposals for trading and clearing OTC derivatives should form an EEA minimum framework.