UK: New banks flood in to compete

A year after UK authorities relaxed rules to allow new banking market entrants in efforts to boost competition, reports say five new banks have already emerged, with more to follow.

According to the UK’s Financial Conduct Authority and the Bank of England, more than two dozen banking applicants have so far been interviewed to possible launch operations and combat the dominance of the five leading banks: HSBC, RBS, Barclays, Lloyds and Santander.

Those five collectively control more than three-quarters of the market, causing officials to pursue new ways to boost competition.

Axis Bank, Union Bank of India, FCMB, UBA Capital and Paragon Bank have all been authorities to operate in the UK, according to reports. Recent spin-offs and new banking operations have also placed the pressure on the Top Five.

In 2010, Metro Bank became the first new market entrant in over a century. It’s launch, reports say, emphasized the barriers new banks face when entering the industry in the UK.

Full content: Reuters

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