Many businesses in the West Midlands are not convinced that banking reforms will prevent another financial crisis.

A poll conducted by Birmingham Chamber of Commerce Group (BCCG), also reveals that there is a strong belief that the reforms will lead to reduced bank lending.

The survey conducted by the BCCG, which has a membership of about 3,000 companies, revealed that 37.5 per cent of its members were "not very confident" and 12.5 per cent were "not confident at all" that ring-fencing the retail side of banks from their riskier investment operations would prevent another financial crisis. Only 18.8 per cent were "slightly confident" and 6.3 per cent were "very confident".

However, over half of those surveyed (56.3 per cent) felt that the requirement of banks to have a higher amount of capital in reserve would lead to an inability or unwillingness to lend. A further 31.3 per cent were unsure of the implications for bank lending. 

A quarter of respondents reported having had difficulty securing a loan from banks.

Ross Gurdin, a policy adviser at the BCCG, said: "The results of this survey highlight the wider impacts of banking reform and it is critical the proposed reforms do not harm the recovery by further undermining business confidence.

"It is vital that we do not sacrifice the ability of small and medium sized businesses to access finance in our attempts to remove some of the risk from the financial sector."

The financial service sector is hugely important to Birmingham, producing over 30 per cent of its GDP - but more importantly financing the city's entrepreneurs and small businesses.  

"We should be looking to SMEs in order to drive the recovery and rebalance the economy. We should ensure that the effects of banking reform on SMEs are at the forefront of our mind before we implement any drastic measures," Ross Gurdin added.