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TSC will question Sants over PRA role

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The Treasury select committee wants to question FSA chief executive Hector Sants over evidence he gave the committee regarding the failure of Royal Bank of Scotland before he takes over at the helm of the Prudential Regulation Authority next year.

The announcement comes a day after Sants gave evidence to the committee where he admitted he “could have shouted louder” about his concerns over RBS and that he was “talked into” applying for the role of FSA chief executive.

No date has been set for the session and though pre-appointment hearings by the TSC are standard practice, the committee says it will have questions for the way Sants dealt with the crisis before it backs him to head up the PRA.

TSC chair and Conservative MP Andrew Tyrie says: “The committee will need to digest the evidence we have heard today. We will be holding a confirmation hearing with Mr Sants in due course with respect to his appointment as PRA chief executive and deputy governor of the Bank of England.”

In December, when a summary report was finally published into the problems at RBS and the regulatory reaction to them, TSC member and Conservative Party vice-chairman Michael Fallon said on BBC Radio 4’s Today programme that it was for Sants to consider the “very good question” of whether or not he should take up the role as PRA chief executive.

Turner responded, saying: “It is important to realise that until July 2007 Hector was not in charge of the key retail division which was responsible for the supervision of RBS and the other major banks. If you read the report, you will see Hector becoming chief executive of the whole FSA is the point we began to do many of the things that needed to be done.”

Recommendations made by the committee, which is still smarting from the financial services bill being published ahead of its final report into the FCA, are not binding. But if it does not back Sants for the role it will put pressure on the Treasury to explain why it feels he is suitable.

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Readers' comments (6)

  • Lord Turner, Hector Sants and Sheila Nicholls should all resign as are all responsible for the attempted cover-up of the regulator's involvement in the banking crisis.

    Their shambolic performance with regards to the implementation of RDR has also got a lot to be concerned about!

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  • There goes Hector's hoped-for knighthood. His admission that he failed to carry out in a fit and proper manner his responsibilities as Chief Exec of the FSA must surely raise serious questions as to his suitability for the top job at the PRA, don't you think?

    Then again, he ought to (but won't) admit that the reason the FSA didn't even attempt to regulate the banks is because it was instructed by the Treasury to look the other way and concentrate instead on softer targets.

    And how he and Hoban have the gall to perpetuate the lie that the FSA is anything other than a part of government ( is something else again.

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  • Totally agree with Julian and Peter

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  • Hector is 'Damaged Goods'.

    Any Organisation that he is connected with, will immediately lose credibility.

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  • Totally agree with the first three comments. Hector Sants is, in no way, suitable for any important role in this country.

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  • One man runs a bank and it falls over.

    One man runs a reguator and it fails to stop the bank falling over because the legislation and HMT are preventing it from doing its job.

    How can one man be blamed for everything?

    Andrew Tyrie is also one man and he is the elected Chair of a committee set up by HMT yet HMT appear to be ignoring what we might expect to be the only group of people who can have the remostes chance of tempering the excesses of regulation simply because they don't have the time or inclination.

    What is the point of it all?

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