Thursday, June 17, 2010
FSA to be scrapped by 2012
In a speech at The Lord Mayor's Dinner for Bankers and Merchants of the City of London, The Chancellor of the Exchequer, George Osborne announced that the FSA will cease to exist in it's current form by 2012
He said:
"What we are proposing is a new system of regulation that learns the lessons of the greatest banking crisis in our lifetime. I can confirm that the Government will abolish the tripartite regime, and the Financial Services Authority will cease to exist in its current form.
"We will create a new prudential regulator, which will operate as a subsidiary of the Bank of England. It will carry out the prudential regulation of financial firms, including banks, investment banks, building societies and insurance companies.
"We will create an independent Financial Policy Committee at the Bank, which will have the tools and the responsibility to look across the economy at the macro issues that may threaten economic and financial stability and take effective action in response.
"We will also establish a powerful new Consumer Protection and Markets Authority. It will regulate the conduct of every authorised financial firm providing services to consumers.
"I can also confirm that we will fulfil the commitment in the coalition agreement to create a single agency to take on the work of tackling serious economic crime that is currently dispersed across a number of Government departments and agencies.
"We will handle the transition carefully, consult widely and get this right. The process will be completed in 2012.
"And I have asked Hector Sants to remain at the FSA to oversee the transition and become the first new deputy governor and chief executive of the new prudential regulator. He will be supported by Andrew Bailey from the Bank of England as his deputy in the new regulator.
"This is a strong team to ensure a smooth transition."
DATED: 17.06.10
FEED: MI
