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British banks are confronting competing pressures: a new banking levy is expected in the Chancellor’s upcoming budget, while the Bank of England’s regulatory arm is easing approval rules for some finance-sector roles. Alex Brummer’s report also highlights AI’s potential to cut costs and displace jobs, alongside risks to payments and trading systems.
British banks face a new banking levy, changes to staff-approval rules and the risks and cost-saving potential of artificial intelligence, according to Alex Brummer’s report for This Is Money. The report says the Chancellor is preparing a levy for next week’s Autumn budget, while Bank of England regulatory chief Katharine Braddick is easing bureaucracy around approving senior personnel; the precise levy terms and the full scope of the rule changes are not given.
The report presents the industry as facing competing demands. It says the regulatory arm of the Bank of England is simplifying the process for certifying finance-sector employees, a change long sought by banking and insurance executives who have complained about delays. Under the described approach, approval requirements would focus on top executives and employees involved in audit. Brummer questions whether the arrangements for chief executives provide adequate safeguards, citing former Barclays chief executive Jes Staley’s appointment and later departure.
Artificial intelligence is presented as both a source of operational risk and a route to savings. Brummer warns that malicious actors could disrupt payments or trading systems, while new technology could reduce costs for financial companies. Barclays is cited as planning to cut 5,000 jobs that the report says will be displaced by AI tools. That figure is the report’s account of the plan; it does not specify a timeframe, identify the roles affected or quantify how much of the reduction is directly attributable to AI.
The report also points to Barclays’ latest results as evidence of pressure on the sector. It says the bank posted third-quarter profits of £2.3 billion, below expectations, and that its shares were down 13% year to date at the time of writing. Chief executive C.S. Venkatakrishnan announced a £500 million share buyback, which Brummer describes as an effort to reassure investors. The report does not provide the exact reporting date or further detail on the expectations used for comparison.
AI and Levy Pressure on Banks
The combination of a potential levy and technology-led restructuring matters to customers, workers and investors because it may affect how banks allocate money and manage services. A levy could add to banks’ costs, but its rate, scope and expected revenue are not stated in the source. The impact cannot be assessed until the government publishes its plans.
AI introduces a separate set of choices. Automation may help banks reduce operating expenses, but job cuts can affect employees and local economies. At the same time, disruption to core payment and trading infrastructure could affect businesses and customers well beyond the financial firms themselves. Brummer identifies these as risks; the report does not describe a specific attack or outage.
Changes to staff approval rules could speed appointments and reduce administrative burdens. But the balance between faster hiring and effective scrutiny is also relevant to public confidence, particularly for senior roles with responsibility for risk and controls. The report’s account raises that concern without providing the regulator’s full rationale or the detailed safeguards that will apply.
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Regulation, Barclays and Market Risks
The report links the proposed changes to a broader argument about the environment for British finance. It says executives have long objected to delays in the certification process and describes the proposed easing as a response to those complaints. Brummer invokes Staley’s Barclays tenure as a reason to question how thoroughly chief executives are assessed. The article does not set out the full history of his appointment or the regulator’s current assessment process.
Barclays is also used as an example of the mixed performance facing large banks. According to the report, its investment bank has strengths in fixed income but was performing less strongly in the period discussed, while equity activity, supported by technology and AI-related business, did well. The report attributes the results to Barclays and market conditions but provides no breakdown of those activities or the bank’s expectations for future performance.
Beyond banks, Brummer notes concerns about British companies and financial data businesses in a period of AI disruption. He cites London Stock Exchange Group’s planned £2.6 billion purchase of US credit intelligence company Octus, described in the report as its largest deal since acquiring Refinitiv in 2019. He also refers to LSEG and Relx reporting higher income despite investor concern about AI’s effect on their businesses. These points form part of the article’s wider account of technology and the competitiveness of UK finance, rather than announcements of new banking rules.
““The threat of bad actors bringing payments or trading systems to a crashing halt is very real.””
— Alex Brummer, writing for This Is Money
Levy Details and AI Impact
The report does not give the proposed levy’s rate, which banks would pay it, when it would take effect or how much it might raise. Those details depend on the Chancellor’s budget announcement, which the source describes as due the following week.
It is also unclear how the changes to staff approvals will be implemented, which roles beyond top executives and audit staff will be covered, or what checks will remain. The report does not include a formal statement from the Bank of England explaining the new approach.
For AI, the source provides no estimate of the number of banking jobs likely to be affected across the sector, nor does it explain how Barclays’ reported 5,000 planned cuts will be phased or which tasks will be automated. It gives no evidence of an AI-related payment or trading outage. The risks described are warnings, not reports of a confirmed incident.
Budget and Bank Rule Changes
The next key development is the Chancellor’s upcoming Autumn budget, which should clarify whether the banking levy will proceed and provide details of its design. The report does not name the date of the budget, so the timing should be checked against the government’s announcement.
Further information from the Bank of England will be needed to establish when the staff-approval changes take effect and what scrutiny will apply to senior appointments. Banks’ future disclosures may also show how AI is being used, what roles are affected and what protections are in place for systems handling payments and trading. Until those details emerge, the scale of the financial, employment and security effects remains uncertain.
Key Questions
What is the new development affecting British banks?
Alex Brummer’s report describes three pressures: a banking levy expected in the upcoming budget, changes to regulatory approval rules for some finance-sector staff, and AI-related opportunities and risks. The report does not provide final details of the levy or the regulatory changes.
It says Barclays plans to cut 5,000 jobs that will be displaced by AI tools. The source does not state the timeframe, the roles involved or how the plan will be carried out.
What AI risks does the report identify?
Brummer warns that malicious actors could disrupt payments or trading systems. The report does not describe a confirmed AI-related outage or attack.
What is known about the proposed banking levy?
The report says the Chancellor is preparing a new levy for the upcoming Autumn budget. It does not specify the rate, who would pay, when it would begin or how much it could raise.
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