The UK government is looking to create three new high street banks with the forced sell-off of bank branches by Lloyds bank Royal Bank of Scotland in the short to medium term. However, it is unclear exactly how these new banks will be created and what kind of strategy and service they will offer the UK population.

Ultimately the UK government would prefer to see a more local economy focused banking network where customers and bank managers were on first name terms, as they were many years ago, but this seems highly unlikely. The truth is that these three new banks which the government is looking to create, if this goes to plan, would be exactly the same as those in operation at the moment but on a smaller scale. A smaller scale will allow greater competition and less domination of the market place which can and has influenced interest rates over the years.

While the UK government's plans for the future seem perfectly acceptable on paper it will be very difficult creating three new banks which will offer a more personalised service to banking customers and also inject competition into the sector. We wait for the details of the government's plans with anticipation.

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