Bank regulation failed – Lords Committee - Economy - News - Moneyfacts

News News brings you the latest financial & economic news & reviews of the best products in the UK by our team of money experts.

Bank regulation failed – Lords Committee

Bank regulation failed – Lords Committee

Category: Economy

Updated: 02/06/2009
First Published: 02/06/2009

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
The House of Lords Economic Affairs Committee has said the current bank regulation system failed in its role of preventing a crisis or at least mitigating its effects.

Echoing the sentiments of the House of Commons Treasury Committee, which criticised the current system whereby the banks are supervised by the Bank of England, Financial Services Authority and the Treasury, it said the existing structure failed in its role.

The Committee recommended reform with the Bank of England to take the entire responsibility for the UK banking system.

The country's banks also came in for some stinging criticism as the Committee said that several large institutions had turned to the state for support while others had failed entirely.

The result of such actions was a dramatic impact on the British economy, the Committee stated, with a Government debt which is rising to levels previously unseen in peacetime.

The report continued: "After 15 years of sustained growth (in the UK economy), it is expected to shrink about four per cent this year. Unemployment is rising fast. There are concerns about the City's position as a leading financial centre.

"The effects are likely to persist for some time."

More powers for authorities to deal with foreign banks in the UK were also called for, while the Committee insisted that new regulatory regime would not stifle innovation.

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Inflation and you: what does the latest rise mean?

Today saw not only the outlining of the Government’s stance on leaving the EU, but also a rise in inflation that was larger than predicted. But what does this mean for the pound in your pocket?

Base rate remains unchanged in surprise decision

Earlier today, the Bank of England’s rate setting committee announced that it had voted decisively to keep base rate on hold at its record low of 0.5%. But what does it mean for you?

Budget 2016 – an overview

Well, George Osborne has just revealed the Budget for 2016 – his eighth so far as Chancellor – and as ever, there were some winners and losers from the whole thing. Below is a quick overview of the key points.