His solution: restrict banking  BIS Review 152/2009  1  to its traditional “utility” function – performing basic retail financial intermediation of deposit taking and lending, and providing payment and settlement services; and hive off the riskier financial services such as proprietary trading into a separate entity.
In what has come quickly to be known as the “utility and casino” model, the “utility” will be heavily regulated and will enjoy implicit government guarantee while the “casino” will be left to the discipline of market forces. 6. Closer home, another equally influential voice – Dr. Y.V. Reddy, former Governor of the Reserve Bank of India – weighed in on the issue.