Back in 2000, Don Cruickshank delivered a review of the banking sector. Five years later, he lamented that if another review were to be started, "all you'd need to do is change the date" on the previous one. Indeed, when another was started five years after that by Sir John Vickers, he may well have felt the same.
When his report was published in September last year, Vickers made clear that a referral of the banking industry to the competition authorities should be considered in 2015 if a strong new bank had not been formed from the sale of 632 branches by Lloyds Banking Group and it had not become easier for customers to switch current accounts.
So the pronouncement by John Fingleton, head of the Office of Fair Trading, that the banking industry might need a full-blown competition investigation is a reminder that the sector – already facing an OFT investigation into current accounts – is under close surveillance. Whether that will change its behaviour is another matter.
