Brussels would not stand in the way of a tough new capital regime for Britain's banks, in spite of claims by David Cameron that the implementation of the Vickers banking reforms could be impeded by EU law.
Mr Cameron demanded reassurances that Britain could go beyond European capital standards in the EU summit of December 8-9, but his demands were left on the table as the other 26 Member States simply side-stepped the prime minister's veto.
The government will on Monday adopt the main proposals of the Independent Commission on Banking, chaired by Sir John Vickers, including plans to ringfence retail banking operations behind a high capital wall to protect against a future financial crash.
Michel Barnier, the EU internal market commissioner, insists that proposed new EU rules enacting the Basel III minimum of 7 per cent of high quality capital would not stop Britain piling on additional capital requirements for its banks, reflecting the systemic threat they pose to the UK economy.
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