Customers of Lloyds Banking Group might soon have fewer branches in which to carry out their banking after the Independent Commission on Banking recommended it should be forced to sell off more of its outlets.
The commission, set up by the Government last June to review the UK banking industry following the financial crisis, has reached the conclusion that competition needs to be reinvigorated amongst the high street banks.
As part of its plans, the report suggests that Lloyds, which has around 30% of current accounts in the market, should be made to sell off some its branches.
The banking group, in which the Government holds a 41% stake, is already committed to selling around 600 branches in England and Wales.
This is under an agreement with European regulators who were concerned over the amount of power Lloyds holds in the banking sector because of its Government backing.
However, the banking commission now suggests that the Government should seek an agreement with the group to 'enhance the divestiture substantially'.
Lloyds has unsurprisingly rejected the idea, claiming it would not be in the best interests of its customers.
However, the group did throw its support behind the commission's suggestion that it should be made easier for customers to switch current accounts if they wish to do so.
Lloyds added that it had provided the commission with evidence of how a guaranteed seven day switching service could be put in place within the next two years.
Amongst the other proposals put forward by the commission was the ring fencing of a bank's retail activities from their riskier investment banking operations.
The commission also wants to increase the amount of money that banks have to keep in reserve in case of trouble, another measure designed to help prevent another financial crisis.
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