The Banking Reform Bill, which is due to reach the House of Lords on Tuesday, will enshrine many of the Commission’s proposals in full. However, a question mark remains over what will be left out of the Bill.
Commission chair Andrew Tyrie welcomed the Bank of England and FCA’s support: “In particular, they accept the need to replace the wholly discredited Approved Persons Regime and the importance of competition as a regulatory objective.”
He said the government now had to carefully scrutinise the Bill: “Our recommendations can have their intended effect – to enhance standards in banking – only if they are implemented as a package. That is why we will continue to press for our proposals to be implemented in full.”
The Bank of England and the Financial Conduct Authority today expressed their broad agreement for the Commission’s proposals. These include the introduction of a ‘Senior Persons regime’ to hold executives responsible and empowering whistleblowers.
Under the Commission’s senior persons proposals, senior members of deposit-taking financial institutions would formally take on responsibilities. These individuals could face disciplinary action under the Financial Services and Markets Act 2000 if something then went wrong on their watch.
In its response, the FCA said it also supported the proposals. It also backed plans to introduce ‘licensing’ arrangements for a wider group of financial services employees than those covered under the approved persons regime.
