My Lords, I rise very much in agreement with the noble Lord, Lord Lawson. The particular point that I should like to make is that if we look at events over the past five years, it was not derivatives or standard investment banking activity which got the banks into trouble but unwise forms of large-scale lending. It was the purchase of blind CDO instruments from the US without knowing what was in them and the banking practices in particular of HBOS. These were the areas in which huge amounts of money were lost and which nearly brought down two of the main banks of this country.
Looking at the ring-fence model, it seems rather strange that all that sort of activity will be in the same box as good old-fashioned high-street banking, as I understand it. I repeat my interest as a director of Metro Bank, which is an old-fashioned high-street bank in essence. But if the high-risk areas of banking generally are going to be in the same box as the lower-risk activities of high-street banking, that does not seem to make much sense. The delineation of what is investment banking and what is commercial, high-street banking is not a particularly good one if your objective is to protect the ordinary citizens’ banking activities.