View more on these topics

Former FSA bigwig spills the beans on HBOS rumours in TV exposé

A former head of supervision at the Financial Services Authority has hit out at the regulator for making assurances last year that rumours of financial problems at HBOS were bogus.

Chris Rexworthy, head of whole-sale supervision at the FSA between 1997 and 2006, spoke out last Mon-day in the first instalment of a two-part Dispatches programme on Channel 4 called ‘Crash – How the Banks Went Bust’

In the programme economist Will Hutton outlines how the regulator intervened when market rumours about the solvency of HBOS caused its shares to plummet.

Speaking to Hutton, Rexworthy says the FSA quickly announced that there was no substance to the rumours and that “HBOS remained a solvent and adequately capitalised banking institution”.

When pressed on whether that statement had in fact been right, Rexworthy says: “It strikes me as an incredible thing for a regulator to say. The rumours that HBOS was in trouble had started circulating only several hours before the FSA made its statement so it’s difficult to see how much detailed analysis it could have done in that period of time.”

The second part of the Dispatches programme airs tonight.


The Perils of Passive Investing

The era of loose monetary policy created an environment that rewarded passive investors in the US. However, with the US raising interest rates for the first time since 2006, Felix Wintle explains why he believes active investing will be more important than ever. In the video Felix discusses: The rising cost of capital and its […]


News and expert analysis straight to your inbox

Sign up