MPs To Quiz FCA Heads On Ditching Banks Probe

The move attracted criticism, with some arguing the FCA had come under pressure from the Treasury to drop the review.

He said: “I would say that we did have that investigation; it was a cross-party parliamentary commission that included people like the Archbishop of Canterbury on it. We’ve implemented its recommendations, including, for example, a new regime where senior bankers have to be properly certified, held to account, can be found guilty of misconduct”.

McDermott has been hotly-tipped to take on the role after chancellor George Osborne failed to re-appoint Martin Wheatley to the regulator’s top job last summer.

The chairman of the Treasury Select Committee, a panel of politicians that examine financial public bodies and banks, Andrew Tyrie MP, confirmed on BBC Radio 4’s Today programme that he would be hauling in FCA CEO Tracey McDermott and chairman John Griffith-Jones to do the explaining.

An influential committee of MPs is to investigate why the FCA dropped a report into banking culture.

The FCA was created in 2013 to replace the Financial Services Authority in the wake of the financial crash, with a remit to regulate conduct related to the marketing of financial products.

Osborne told the BBC on Thursday he played no role in the FCA’s decision to scrap the culture review. “The Committee will want assurance from the FCA that it is up to the job”, Tyrie said.

He added that the shortcomings in regulatory standards exposed during that time were “almost as bad as in banks”. “It’s got to be an independent decision for our banking regulator”, Osborne said. “We have decided that the best way to support these efforts is to engage individually with firms to encourage their delivery of cultural change as well as supporting the other initiatives outside the FCA”.

Britain has been among the toughest of banking regulators since the crisis, with the Bank of England and FSA engineering the departure of Bob Diamond as head of Barclays in 2012 after the bank was fined for trying to rig the global Libor interest rate benchmark. I understand and respect the decision Tracey has made.

But Osborne said this morning that McDermott had not been shortlisted because she “doesn’t want the job full-time”.