Although the latest steps in the rehabilitation of RBS and the LLoyd's Group are being announced by British ministers, the decisions were taken in Brussels. In most EU countries [including the eastern states, before they were captured by the communists] smallish banks, often run on a mutual or local basis, were the norm. The megacorporations have largly been for corporate banking business, while personal account-holders and mortgagees have been with the smaller banks.
Thus the changes that may seem to be a little eccentric to the British are definitely intended to move the picture nearer to parity with the 'old' EU.
The fifty-odd billions of pounds that are to be added to the two banks' balance sheets are a [largish] drop in the ocean on top of what the public have committed to 'saving' the banks over the past fifteen months. RBS and Lloyd's will still be massively bigger than the new spin-off banks; so 'competition' will only be assured by an active regulatory regime.
We won't see the full picture for months.
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