Brooke Masters wrote that Rathbone Brothers, the Private Client Wealth Manager, is initiating a formal analysis of whether to retain its banking license.

Many other wealth managers do not have banking licenses, and Rathbone's move, revealed alongside its results, comes as global and UK banking regulators are reviewing requirements for banks, including demands that they hold more capital as well as high liquid assets.

Chief Executive, Andy Pomfret, emphasized that the group has not made up its mind on the issue of the license.

The announcement came after Rathbone’s full-year pre-tax profit fell 30% from £42.3m to £29.5m. A 40% drop in interest income overpowered small growth in fees and commissions.

Mr. Pomfret forecasted "volatile and unpredictable" market in 2010 and a tough regulatory environment.

"The burden of regulation is increasing and we are very much aware that we may face additional regulations that are aimed at much larger banks", he said in a statement.

Funds under management rose 12% to £13.1bn. A deal with Lloyds Banking Group has fetched 2,500 new clients and £500m in funds to date.