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MP calls for FSA overhaul

The damning internal re-view of the Financial Services Authority’s blunders in the Northern Rock affair shows the regulator needs a “root and branch” reform.

This is the view of John McFall, chairman of the Treasury Committee, who will grill FSA chiefs next month as part of an ongoing inquiry into financial stability.

McFall says: “The industry has a re-sponsibility to work with the regulator to maintain confidence in the financial services sector.

“To some extent, the present liquidity crisis is a result of trading in products so complicated that market participants did not understand what they were buying.”

The review reveals several FSA failures with regard to NR. These include a lack of sufficient supervisory engagement with the bank, a lack of adequate oversight by FSA management of the quality, intensity and rigour of its supervision and inadequate resources to supervise NR.

Hector Sants, chief executive of the FSA, says: “It is clear that our supervision of NR was not carried out to an acceptable standard. But whether that would have affected the outcome in this case is impossible to judge.”

The FSA plans to beef up staffing levels and training. It also intends to keep a closer eye on big banks by creating supervisor specialists.

These specialists will review the supervision of what the regulator calls high impact firms, which means financial services companies that could jeopardise the financial stability of the UK.


Call for empty homes to be brought back into use

More than 80,000 empty homes in the South-East could help tackle the region’s housing shortage if they were brought back into use, according to Henry Oliver, policy adviser at the Empty Homes Agency.

CHL to make 50 redundant

CHL Mortgages is to shed some 50 jobs as part of its plan to slash mortgage business in the coming months. The specialist lender and subsidiary of Irish Life & Permanent said it plans to focus on credit quality and margins in future.

Some areas to be upbeat about

Gary Styles, strategy, risk and economics director of Hometrack, identifies the big risks to economic stability in 2008 and comes up with a prognosis for the UK that is not an entirely gloomy one

Finance teaching gets poor marks from Ofsted

Teaching personal finance in a cross-curricular programme – for example, within a maths syllabus or as part of citizenship studies – is not as effective as focusing on the subject in its own right.

Advice or guidance? That is the question

The Retail Distribution Review (RDR) brought many benefits to the UK pension industry, but it also created an advice gap, resulting in consumers with the smallest funds struggling to access advice at a suitable price By Justin Corliss, Business Development Manager The Financial Advice Market Review (FAMR) produced in March 2016 aims to remedy this, […]


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