Biodiversity is essential for reliable and stable long term food production. The famines in Ireland in the nineteenth century and in Ethiopia in the late twentieth century provide clear evidence of the vulnerability of undiversified crops to environmental changes, and the dramatic consequences of such vulnerability for the population.

The financial crisis, which is still ongoing, resulted largely from the boom and bust in home prices that preceded it for several years (home prices peaked in the United States in 2006). During the pre crisis boom, homebuyers were encouraged to borrow heavily to finance undiversified investments in a single home, while governments provided guarantees to mortgage investors.

So the ICB concluded that its reform package for the UK would achieve the main aims of full separation at a lower cost, and without creating the risk to financial stability that could come from having undiversified, correlated, stand alone domestic retail banking. To be sure, the success of this approach depends on the fence staying strong.