LONDON, June 30 (Reuters) - The case for making Britishbanks protect domestic retail customers from riskier parts oftheir operations is as strong now as it was in 2011, thearchitect of the proposals told a House of Lords committee onTuesday.
The Bank of England has told banks they must set up aboundary around their branch operations to protect taxpayersfrom any repetition of the multi billion-pound bailouts requiredduring the financial crisis of 2007 to 2009.
John Vickers, who headed the Independent Commission onBanking (ICB) which recommended the new "ringfencing" rules in2011, said the rules were still necessary despite some bankerssaying other regulatory reforms had made them redundant.
"In my view the case for those measures every bit as strongas when we made our report four years ago, arguably strongerstill," Vickers told the House of Lords Economic AffairsCommittee.
The ICB was tasked with making proposals to reform theindustry after Britain bailed out Royal Bank of Scotland and Lloyds Banking Group at a combined cost of 66billion pounds during the crisis.
Former Barclays Chairman David Walker has said newcapital and liquidity requirements introduced since the ICB'sreport and new European rules on the recovery and resolution offailing banks had made ringfencing redundant. (Reporting by Matt Scuffham, editing by Sinead Cruise)