Three independent reviews to analyse BoE’s response to financial crisis
The Bank of England has set up three independent reviews into how effective its response to the financial crisis over the last five years has been.
The three reviews will focus on ensuring the BoE has the capability to respond to future crises and will pay close attention to the the collapse of Lehman Brothers in the US in September 2008, the recapitalisation of the major UK banks and the deep global recession.
Beginning immediately, the Bank has asked BH Macro chairman Ian Plenderleith to review the Bank’s actions at the height of the financial crisis and its ability to provide emergency liquidity assistance.
Renshaw Bay chief executive Bill Winters and former JP Morgan Investment Bank co-chief executive have been asked to gauge whether the reforms introduced after the Treasury Committee’s report, called the run on the Rock, have worked.
And David Stockton, former director of research and statistics at the Board of Governors of the Federal Reserve System, has been asked to review the forecasting capability of the monetary policy committee.
All three reports will be published shortly after they have been presented to the Bank in October 2012.
But the reviews will only concentrate on areas where the Bank had sole responsibility and will not stray into the actions of the other tripartite authorities – namely HM Treasury and the FSA.
Any wider inquiry it says would need to consider the actions taken by all the authorities together and would therefore need to be initiated and conducted by an independent body.
BoE governor Sir Mervyn King says: “I welcome this set of reviews. Major changes to the operations of the Bank have already been made in the light of the financial crisis. These detailed, independent reviews will help to ensure that all the important lessons for the future have been learned.”