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Topics: FSA| | Paul Myners| Hector Sants| Which?
The FSA will step in to "police" the banking sector, but has doubts over whether it can actually change its culture.
Outgoing chief executive Hector Sants said the FSA can and should ensure banks treat customers fairly, especially by "significantly improving" the financial advice banks offer customers.
He said: "The financial advice the banks offer...we can certainly improve significantly, and that is the intention, the behaviours of people supplying that advice through a mixture of more rigorous proactive regulation and more effective deterrence and enforcement."
But FSA chairman Lord Adair Turner caveated Sants' hardline approach with the admission the regulator's powers are not limitless.
He said: 'We simply do not know if we have the tools to change the banking culture.
"We have pursued the Treating Customers Fairly principle, and can push the banks to change, but they will have to want to change."
The two giants of the UK regulatory environment made the comments at yesterday's Which? Future of Banking Commission select hearing.
Sants announced in February he will exit the FSA in the summer, after three at times controversial years steering the regulator.
In March last year he warned the City it should be "very afraid" of the watchdog.
The FSA's future remains in the balance as the Tories have said they would look to bring its functions within the Bank of England if they take power in the next General Election.
However with a raft of new appointments, including Baigrie Davies' director Amanda Davidson as a non-executive to the FSA Board, speculation is rife any changes at the regulator would merely be a "name change".
At yesterday's conference, Financial Services Secretary to the Treasury Lord Paul Myners also said a radical shift in the way banks conducted their business was essential.
Without it, he said, there could be little hope of an improvement in the way consumers viewed the financial services sector.
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FSA
Well I guess if you have a regulator run by the banks i.e.most of the senior staff are ex bankers it's not surprising that the banks won't change or be forced to. It is infuriating that nothing has changed after the financial crisis. Banks are still coining it in, the regulator is expanding as if theres no tomorrow & not regulating the big boys, Government is spending like mad & the little guys are penalised & I suspect a conservative government will not change things much.
Posted by: Gob Smacked
FSA
Well I guess if you have a regulator run by the banks i.e.most of the senior staff are ex bankers it's not surprising that the banks won't change or be forced to. It is infuriating that nothing has changed after the financial crisis. Banks are still coining it in, the regulator is expanding as if theres no tomorrow & not regulating the big boys, Government is spending like mad & the little guys are penalised & I suspect a conservative government will not change things much.
Posted by: Gob Smacked
bank culture
It must be my lucky week, three items in this issue I feel strongly about. Where oh where are we going to. FSA will change the culture of IFA,s. They have made it quite clear. However to make the comment that they cannot change the culture of the Banks is absolutely appalling. They need to put their brain in gear before engaging mouth(i could put something else in other than mouth, but I am trying to be polite and remain calm.
Posted by: terry
Dear Lord Turner ...
I am very intrigued by your comment .. 'We simply do not know if we have the tools to change the banking culture". I wish to apply for the job at the FSA entitled "Bank culture changer" and I certainly DO have a bag of tools which will be perfectly suited to such a job ! I look forward to hearing from you !
Posted by: ROBERT WYATT
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Its up to you
So the fsa can "push the banks to change but they will have to want to change" One lot of regulation for the banks and another for IFAs. When did the IFA community ever get the choice of doing something, only if it decided it wanted too? Why the Stasi police type regulation for IFAs and the softly softly, dont frighten the horses type of regulation for the banks? Makes my blood boil!
Posted by: Absolutely livid