Lloyds TSB, HBOS and Royal Bank of Scotland have been threatened with full-scale nationalisation unless they pass on rate cuts to customers.
The chairman of the Treasury Select Committee John McFall is quoted in the Daily Mail today as arguing that if the lenders don't "play ball" then the government is prepared to get tough.
He says: "If the banks do not play ball, and will not resume lending the demand for full-scale nationalisation may well grow. Recapitalisation was only a first step."
