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The government inquiry into banking sector reforms will consider breaking up the UK's largest high street banks to increase competition, it has been confirmed.
The Independent Commission on Banking (IBC) confirmed it will look into whether investment banking should be divorced from retail banking and will look at ways to boost competition.
It stressed the commission had not settled on any options at this point, but chair Sir John Vickers, former chair of the Office of Fair Trading, said "hard questions" needed to be asked.
He said: "Questions about the structure of banking need to be debated in an open, rational way, and we would like to invite anyone with an interest to provide us with views and evidence."
The commission was appointed in June by the government to assess the structure of the industry in the wake of the financial crisis, which saw taxpayers bailing out financial groups.
The ICB issued it first paper on the topic today setting out the scope of its year long inquiry.
It also said that current European Commission requirements for part-nationalised Lloyds and Royal Bank of Scotland (RBS) to offload branches and assets could "go further".
Speaking to the Today programme, Treasury committee chair Andrew Tyrie welcomed the announcement and said the present banking arrangements needed to change.
He said how he hoped the review would look at all the "radical options... if necessary 'going big".
"Another key area I'm extremely pleased they are taking seriously is this point about concentration in banking," he said.
"The consumer is losing out and is going to lose out even more unless we do something about the fact that we don't have enough choice in banking."
He added: "The bottom line's got to be we can't go on as we are. We have got to grasp this nettle."
The IBC has until September next year to report back with its recommendations.
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