The FCA and Prudential Regulation Authority are launching enforcement investigations into the Co-operative Bank.
The Co-op Bank was forced to withdraw a bid to buy 632 Lloyds Banking Group last year when it discovered a £1.5bn capital black hole.
The PRA investigation will consider the role of former senior managers. No further information will be provided on the investigation until the legal process has concluded and an outcome has been reached.
The PRA and FCA investigations are the latest in a long line of other inquiries into the Co-op Bank’s problems including an internal review, an independent Treasury-commissioned inquiry and a Treasury select committee inquiry into the failed Lloyds’ branches bid.
The independent review will only take place once regulatory investigations are complete and will look into all issues around the bank.
FCA director of supervision Clive Adamson is being grilled by MPs tomorrow morning over his role in supervising the Co-op Bank’s troubles.
There is also a police investigation into former Co-op Bank chair Reverend Paul Flowers over drug allegations last year.