The government has today launched a consultation on proposals to extend new tougher standards for bankers to UK branches of foreign banks. As a result of the proposals, the Senior Managers and Certification Regime, which ensures that the Financial Conduct Authority (FCA) and the (PRA) can fine or sanction senior bank managers for misconduct that occurs in their areas of responsibility, would cover all banks that have a presence in Britain.
Strong and successful financial services that set the highest standards are an essential part of building a resilient economy. Senior managers must also be held accountable for misconduct. That’s why the government introduced the Senior Managers and Certification Regime for UK banks in the Banking Reform Act in 2013. The Chancellor then announced in his Mansion House speech in June 2014 that the government intended to extend this regime to cover all banks operating in Britain.
A key part of the government’s long term economic plan is to strengthen the banking system so that it is better placed to support Britain’s customers and businesses. By improving standards and accountability in the banking sector, the Senior Managers and Certification Regime does just that.
Today’s announcement builds on the measures the government has already taken to strengthen the regulation of the financial services industry, including the creation of two new, stronger financial regulators last year, the PRA and FCA, to replace the flawed, tripartite system which was in place during the financial crisis.
In June this year the government also announced the establishment of the Fair and Effective Markets Review (FEMR), which will make recommendations on what needs to be done to reinforce confidence in the fairness and effectiveness of financial markets in June 2015.
Economic Secretary to the Treasury Andrea Leadsom said:
A key part of our long term economic plan is to strengthen Britain’s banking sector so that it works better for customers and businesses. Ensuring that our banks are properly run is vital for the health of our economy.
As this consultation makes clear, the government is determined to tackle unacceptable behaviour by holding senior bankers fully accountable. We are determined to make sure that all banks in Britain operate with the highest standards.
The consultation will run until 30 January 2015.