He said the banks were being disingenuous by suggesting reform now would derail the UK recovery, according to The Guardian.
The City rounded on Cable and the row highlighted the division down party lines between Conservative Chancellor George Osborne and Liberal Democrat cabinet ministers, including Cable and deputy Prime Minister Nick Clegg.
Cable has always argued for a harder reformist line on the banks than the Tories, but sparked a row when he said bankers were being “disingenuous in the extreme”, in arguing for a delay in plans by the Independent Banking Commission (IBC) to force banks to ring fence their retail and investment banking operations.
Reforms would force high street banks to increase their reserves and the banking lobby has suggested it could endanger economic recovery.
Conservatives want to push reforms out to after the 2015 general election, with Osborne reported as saying they could wait till 2019.
Angela Knight, the head of the British Banking Association, said: “The emphasis at the moment should be on economic recovery rather than another assault on the banks.”
David Hillman of the Robin Hood Tax campaign reportedly said: “We must not be deterred by bank lobbyists whose idea of ‘economic recovery’ means increasing profits.”
