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Chancellor may increase FSA’s role in financial stability

Chancellor Alistair Darling is reportedly planning to strengthen the role of the FSA on financial stability which he has set out in a banking white paper due out shortly.

Darling is tipped to give the FSA more powers to maintain financial stability following criticisms that the Bank of England failed to adequately warn of the banking crisis. This responsibility currently rests with the BoE.

The legislation would give the FSA the ability to question a bank’s practices and order it to make changes if it appeared to be threatening the stability of the banking stability.

This will be seen as a blow to the Conservatives who are proposing to scale back the role of the FSA and give power to the BoE.

This week BoE governor Mervyn King complained that he had not been consulted on the content of the white paper.

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. Julian Stevens 26th June 2009 at 2:43 pm

    Chancellor may increase FSA’s role in financial stability
    Recommended reading on the FSA ~ http://www.scribd.com/doc/16252092/Adam-Smith-Institute-financialcrisis

  2. Well then, that is the end of financial stability!
    Unless the regulators buck up their ideas we are all going to suffer, again and again. Like the Teletubbies they do the same old thing “Again, again”.

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