Osborne statement on banking reform plan in full

Chancellor George Osborne has welcomed the Independent Commission on Banking's final report, which proposes that there should be a "ring fence" between banks' retail and investment divisions.

In a Commons statement on 12 September 2011, Mr Osborne pledged to "legislate in this Parliament to put the needed changes into law".

But he noted that the proposals were "far-reaching and complex", and did not expect changes to the British banking system to be complete before 2019, as recommended by the report.

The commission, chaired by former Office of Fair Trading boss Sir John Vickers, also said banks should set aside larger cash reserves than required under current regulations to cushion them from future financial crises.

Shadow chancellor Ed Balls said he was "deeply sorry" for the part the last Labour government played in the regulatory failures which led to the banking crisis and urged Mr Osborne to make the changes "as soon as possible".

But he claimed that Mr Osborne had attacked him in 2006 for supporting "burdensome" regulation, adding: "Perhaps the chancellor also needs to show a bit more humility about that global regulatory failure."