Stephen Green made the comments in an interview with the Sunday Telegraph while discussing the future overhaul of regulations surrounding the banking sector.
His comments follow calls from Vince Cable, the UK Coalition governmentâs business secretary, that banks deemed âtoo big to failâ need to be divided up to lessen the exposure to risk faced by the UK taxpayers.
Mr Cable recently stated that in terms of economic reform, there was a clear direction towards separating investment from retail banking within financial institutions.
However, Stephen Green told the newspaper that breaking up large institutions would be difficult as it would require a clear definition of retail and investment.
âIf all open positions were deemed to be proprietary trading, does that mean you cannot run a foreign exchange book and that each time a corporate client wants to do an exchange transaction, there has to be an equal and opposite one into the market?"
"You will bring a lot of illiquidity into the market if that's the way you set it up and that can't be a good idea. The devil is in the detail," he explained to the news provider.
Earlier in the month, Mr Green told the Dow Jones Newswire that the current stress testing of financial institutions within the eurozone is important to help restore investor confidence in the banking system.
By Jim Ottewill