FSA chairman Lord Turner has warned that bosses of failed banks could have two years’ pay clawed back from them.
Speaking to the BBC, Lord Turner said he was attracted to the action as it would discourage banks from taking excessive risks. The rule is already in place in the US.
The FSA has recently come under fire from Vince Cable for failing to release its report into the problems at Royal Bank of Scotland after it was bailed out by the Government in October 2008. Turner said that he was open to the idea of publishing these types of reports in the future, however he added the RBS report was difficult to publish due to it being broken down into numerous parts.
The FSA found no grounds for punishing the banks’ senior directors or the company.