In the story, the submission to the Parliamentary Commission on Banking Standards advocates more stringent regulatory caps and full separation of retail and investment banks to speed up industry reform.
The Commission is investigating measures to overhaul industry practices and restore trust in the industry following the PPI and Libor manipulation scandals.
The submission from Virgin Money, owned by Richard Branson (pictured) advocates wide-ranging changes that it claims would level the playing field for new entrants to the high street banking sector, as well as restoring the reputation of the embattled industry.
Virgin said ring-fencing investment banks would not go far enough and advocated full separation of retail and investment banks. According to Sky, the provider also recommended a standard risk model across the industry instead of the individual risk management systems run by the banks.
Established banks should be forced to sell parts of their branch networks if they fail to deliver a robust new framework to customers who want to switch their bank account provider, said the challenger bank.
Other recommendations include Virgin Money’s suggestion bank boards should have only two executive directors to help non-executives to challenge decision-making; that banks should advertise for some non-executive vacancies; that whistle blowers should be afforded proper protection; and that banks’ auditors should engage in more active dialogue with industry regulators.
Analysts pointed out that many of Virgin Money’s recommendations were potentially self-serving in that they advocated greater opportunities for emerging players in the retail banking sector.
The bank’s takeover of Northern Rock was under scrutiny today by members of the Public Accounts Committee.
The Commission, chaired by Andrew Tyrie, who also heads the Commons Treasury Select Committee, is due to report its recommendations before the end of the year.
Virgin Money refused to comment.
