15 November 2017 
Matt Sisson, Projects and Membership Manager
We’ve previously commented on the potential risks of the new bank ring-fencing rules. The rules were introduced in a bid to make the banking system safer for retail customers (including universities) following the financial crisis. The changes are to be enacted by 2019, and will see some of the largest banks split their retail and investment/global operations and strengthen balance sheets.
The impact of the ring-fencing on the Banks’ customers will be mixed. All banks have different corporate structures, business models, and exposure to risk, as well as different lawyers, and so will be affected by the rules in different ways. Some customers will see absolutely no change in service, and will not notice the ring-fencing. Others may have to prepare for things like a change in bank sort codes (and those of their suppliers), or even amending covenants.
Finalysis has published an update this week outlining the potential challenges it sees as a result of credit-rating changes to the non-ringfenced banks (NRFBs) that will be created as part of the changes. It also lists some questions that you should be asking your bank if you haven’t already.
So the message remains the same, if for some reason you haven’t yet heard from your bank about the changes, and about the impact they may have on your banking service, then do get in touch with them sooner rather than later. And please be aware that your payments teams may see an increase in the number of requests for changes to supplier sort codes. The same counter-fraud rules apply in any case – follow your processes, check, and then check again that these are not fraudulent.
