The implementation of the ring-fence, in which retail banking services are separated from riskier investment and international banking activities on bank balance sheets, was legislated in 2013 as a key element of the country's post-crisis reform package.

The sheer scale of the task was emphasised by Bank of England director James Proudman in a speech to the British Bankers Association, in which he reminded the industry that “responsibility for implementing the Banking Reform Act - that is, successfully putting up the ring-fence on time - lies fairly and squarely with the banks themselves.”

To this end, the “Bank of England will require full and prompt implementation of the ring-fencing legislation and requirements by 2019. To achieve this, much work must be completed by the banks within a limited timeframe. While the timelines vary, all banks plan to meet this tight deadline, with the bulk of restructuring activities planned from now to mid-2018.”

Proudman highlights the change to bank sort codes and the transfer of business accounts to new legal entities as key issues that banks need to address before the ring-fence goes up.

The banks estimate that almost a million retail and corporate customers will see changes to their sort codes. To minimise disruption, banks will need to ensure that any outgoing payments, for example standing orders and Direct Debits, are made as normal. Banks and payment schemes will also redirect any incoming payments to the new account details.

The looming split has been billed as the largest UK banking infrastructure project since the Y2k bug scare or the adoption of the euro and will likely cost the industry billions of pounds to implement.

As with any large infrastructure project, it could “face a high degree of delivery risk that all involved are seeking to monitor and mitigate”, says Proudman. He also notes that “there is some potential for disruption to everyday activities as new group structures are moved into place and new ways of operating are brought on-line”.