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<p>Under the 2012 Financial Services (Banking Reform) Act large UK banks with retail
deposits totalling more than £25 billion are required to ring-fence the deposits of
individuals and small businesses from other activities within their groups, such as
investment and international banking.</p><p> </p><p>All banks within scope of the
ring-fencing regime have successfully completed the necessary restructuring of their
operations in advance of the regime coming into force in January 2019. This includes
moving customers from one part of the bank to another, changing over a million sort
codes and the joining of both UK and international payment systems to facilitate operational
separation. The banks have also completed large technology migrations as part of the
changes to their internal processes</p><p> </p><p>By insulating these core banking
services in a separate legal entity, ring-fencing will support continuity of provision
of vital services to the economy if there are shocks originating elsewhere in the
group and the global financial system. It will also make banks that provide these
essential services simpler and more resolvable and therefore prevent the costs of
failing banks falling on taxpayers.</p>
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