UK Bank Group Warns New Levy Could Make UK Less Competitive

22nd Jun 2010 13:50

By Patricia Kowsmann Of DOW JONES NEWSWIRES LONDON (Dow Jones)--The British Bankers' Association warned Tuesday that the U.K. government's move to impose a tax on banks could make the U.K. banking sector less competitive, and said it will work with authorities to ensure the levy won't affect lending to businesses and individuals. "Bank levies need to be coordinated internationally: they must not prevent the industry in the U.K. from being able to compete," the association said in a statement. "It is essential that the international banks do not find themselves taxed multiple times for the same thing," it added. Earlier Tuesday, U.K. Chancellor of the Exchequer George Osborne said his government will impose a widely expected levy on banks' balance sheets starting in January next year. He said the government expects to raise GBP2 billion a year from the move. Shares of the U.K. banks had a positive reaction to the announcement. "Overall, the levy seems lower than feared and will spread across building societies and U.K. operations of international banks operating in the country," Oriel Securities analyst Mike Trippitt said. -By Patricia Kowsmann, Dow Jones Newswires. Tel +44(0)207-842-9295, [email protected] (END) Dow Jones Newswires June 22, 2010 08:50 ET (12:50 GMT)