Banking reforms: two-nil to the banks

The change to ringfencing makes sense but the regulator will now have to prove bank shortcomings if it wants to dish out fines or bans

A regulatory victory for the banks? Of course. Actually, it's two victories. First, under the new ringfencing rules, the retail operations of big banks will be able to pay dividends to their parent companies. Second, when things go spectacularly wrong at big banks, senior executives will no longer have to prove they took all reasonable steps to prevent catastrophe; instead, the burden of proof will lie with the regulator.

Only one of these victories - the first - is deserved. An outright ban on ringfenced retail units paying dividends never made sense. Who would want to own, or invest in, a high street bank where surplus capital could be trapped permanently? Banks are still businesses, let's not forget.

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