"The infection of retail banking by the culture of casino banking" had to be tackled, Mr Miliband said as the party met for its conference in Manchester.
Recommended ring-fencing of retail from investment banking had been watered down by the government, Labour said.
The Treasury said it was "undertaking radical reform" of the banking system.
The Labour Party conference slogan is "Rebuilding Britain".
A Labour Party statement said: "We need to rebuild High Street banking so that they back British businesses, savers can feel safe, and we get the long-term investment needed to bring the new growth and jobs in our economy.
"That means High Street banks must be properly separated from casino banking."
The ring-fencing of retail from investment banking was recommended last year by the Independent Commission on Banking, led by Sir John Vickers.
Recent scandals over Libor interest rate-rigging and payment protection insurance mis-selling had reinforced "how important it is to achieve real culture change", Labour said.
But it went on: "While the case for change has grown, the change we are seeing has diminished.
"The government has caved in to a concerted lobbying campaign to water down the Vickers proposals for the ring-fencing of High Street banks from the casino culture."
The party warned the banks that they had until May 2015 - the date of the next general election - to deliver change, adding: "Carrying on as they are will not be an option."
Mr Miliband said: "Either they can do it themselves - which frankly is not what has happened over the past year - or the next Labour government will, by law, break up retail and investment banks.
"We need real separation, real culture change. Or we will legislate. If they don't do it voluntarily, embrace the change Britain needs, then we are going to have to do it by law."
Responding to Mr Miliband's comments, a Treasury spokesperson said: "The government is undertaking radical reform of the UK banking system to ensure that the mistakes of the past aren't repeated, that the taxpayer is protected and that the banks support the UK economy."
The British Bankers' Association (BBA) said: "Since the onset of the global financial crisis, banks and banking regulation have changed completely.
"The UK's major banks have committed publicly to further change - to do whatever is necessary to restore financial stability, to play their part in economic recovery and to earn back the trust of their customers."
The BBA said it was currently working with the government and regulators to implement ring-fencing.
It added: "The goal of everyone involved in this global banking debate is to create a stronger, more reliable banking system with a customer-focused culture. The only differences are in the remedies proposed."
No comments:
Post a Comment