Essays on Deregulated Banking Industry in the UK Case Study

Download full paperFile format: .doc, available for editing

The paper "Deregulated Banking Industry in the UK" is a perfect example of a macro & microeconomics case study.   Britain has had a crisis with regard to its big debt that has threatened to lead the economy to a double-dip recession. A number of economic experts have claimed that the deregulated banking industry is responsible for the current economic downturn in the UK. The debt problem which has affected the country has close links with the banking sector due to the policies in the industry that affects how the country borrows money from foreign governments.

As of last year, the United Kingdom was faced with the worst budget deficit among the European Union (EU) countries, this was because that value was in excess of 10% of its GDP. A figure that was high, for the British Government, was said to have spent more than rose from its revenue at an estimated 146 billion pounds. While the Government tries to reduce the amounts of money overspent, the debt has kept on increasing with the deregulated bank industry being blamed for the economic crisis that has befallen the UK.

The UK owed £ 967bn in October 2010, a figure that was up from £ 837bn debt recorded the previous year earlier. This even is made worse by the predictions that the figure will hit £ 1 trillion in the 2012/13 fiscal year. I agree with the suggestion that the deregulated UK banking industry has significantly contributed to its current economic crisis (Sharma, 43). Historical background of the UK's deregulated the banking industry The case of the deregulation of the banking industry in the UK is not a new concept for it first may be dated back to 1987, after the banks and the building societies were engaged in competition with each other with regard to the provision of financial services.

Many of the building societies that were in the UK were converted into banks owned by shareholders (the societies included Halifax & Abbey National). The mergers led the long-established banks to benefit from the customer base, services, as well as specialized programs that were provided by the former building societies. The demutualized insurance companies were additionally bought by the large existent banks in the UK though they retained their identity (Shull & Hanweck 54).  

References

Bie, V. Effects of deregulation on safety. London: Springer, 2003. Print.

Roussakis, E. Commercial banking in an era of deregulation. London: Greenwood Publishing Group, 1997. Print.

Sharma, S. Management Of Financial Institutions: With Emphasis On Bank And Risk Management. London: PHI Learning Pvt. Ltd.2010. Print.

Shull, Hanweck Bank mergers in a deregulated environment: promise and peril. New York: Greenwood Publishing Group, 2001. Print.

Download full paperFile format: .doc, available for editing
Contact Us