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Sants: ‘I never wanted to be FSA chief’

FSA chief executive and future chief executive of the Prudential Regulation Authority Hector Sants has revealed he had no interest in leading the regulator when he joined, and is in only in the role because he was persuaded to apply.

Sants was quizzed last night by the Treasury select committee over the regulator’s supervision of Royal Bank of Scotland in the run-up to the bank’s near collapse. The Government now holds an 82 per cent stake in the bank.

In response to a question from TSC chairman Andrew Tyrie about when Sants knew he was going to take over from John Tiner as FSA chief executive, Sants replied it was not a job he “particularly wanted to take on”.

He said: “The original arrangement with John Tiner was that I would do three years as one of three managing directors. He told me when I joined he would be doing a longer period than in the event he turned out to do and I made it very clear I had no interest in staying for that long a period to put myself forward for the chief executive post.

“I did not join the FSA with the intention of  being the chief executive. I did not expect John Tiner to leave, I was not originally intending to apply for the job, I was persuaded to do so.”

TSC member and Labour and Co-operative MP for Edmonton Andy Love said Sants had been through “a baptism of fire”, but questioned Sants on what he has learned that better equips him to carry out his new role as chief executive of the PRA compared to when he joined the FSA.

Sants said the FSA did its utmost during the crisis against a backdrop where the regulator was not staffed adequately or structured effectively.

He added: “It is worth reminding ourselves that I was leaving, and that I was asked to stay. I decided it was the right thing to do to stay on the basis that I accepted the argument made to me that I was the best person to take forward the regulatory reform programme and leave the regulatory regime in a good shape.

“That is what I think I should be judged on. I have been given a specific task which I was persuaded to take on, that is what I am currently delivering. At the moment the reform programme is on track, I think we have learnt a lot from the experiences and we are using all that experience to make a better regime for the future which will significantly diminish the probability of these types of crises happening again.”

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Comments

There are 11 comments at the moment, we would love to hear your opinion too.

  1. Perhaps more revealingly the article on him in the Guardian, shortly after he was crowned, included a comment from a former work colleague that heading the FSA had been one of his targets. The other is a knighthood.

    Google and check for yourselves.

  2. All true Alan.
    How will further crises be averted when the FSA are still concentrating all their efforts on IFAs’ particularly with their Business Risk Awareness workshops?
    What is the difference between a sole trader going bust and RBS or HBOS doing the same?
    Do the FSA know the answer?
    Or do they still want to flex their muscles and crack the whip over those who have no might to fight?

  3. I wonder what Hector Sants bonus is like this year??

  4. Just goes to show what little ethics this man has He did not want the job so took it so he could stitch up the consumer market.He should now resign as we all know he hates the job No need to touch RBS as the bank was making loads of ‘profit’.so lets go for soft option IFA’s who cannot fight back due to an unelected dictator telling clients how they must pay for advice when living in a democracy they should be given the choice

  5. 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!

  6. @Anon 11.32am, whilst I agree in part with your sentiment, I do believe that the FSA needs to focus on ALL regulated firms and activities. Whilst from a solvency perspective, a bank going bust cannot compare with a sole trader IFA going bust, the reality is that risks fall in every area. I’m sure we all know of people who have suffered financial loss due to wrongful advice from IFAs – it’s important that all consumers are protected.
    The FSA does need to be proportionate, and I believe they are being – the banks have seen a massive tightening of regulation -Solvency II being a prime example.
    The effects of a lack of regulation – whether it be IFA, tied adviser, a bank or building society – can potentially be devastating to any individual that interracts with them. Maybe too much focus on macro regulation, and non enough on the micro.

  7. Believe me Sants, we dont want you either!!! How about Money marketing following up on Allan Lakey’s Points??? The FSA are so bent they cannot stand up straight.

  8. Sam Jones
    No argument from me that all F.S. need regulation.
    The point I was making, which I believe is pretty obvious, is that the regulator already accepts that it missed the bigger picture because it concentrated on, mainly how advisers were embedding TCF while
    the banks were out of control. The regulators focus with BRAW for 2012, does not appear to have altered a failed strategy.

  9. @Anon
    I appreciate your point.
    I do think it’s a very big generalisation to say the banks were out of control, and even to suggest that greater regulation was the answer. Take the Lloyds Banking Group – a good solid company, with a great reputation & low risk strategy, until it was forced by the Government into buying a failing Halifax. Could greater regulation by the FSA prevented that? Probably not…

  10. Well Sam,Point taken over Lloyds but whichever way you want to look at the situation, I doubt very much whether any IFA will ever cause £45 Billion worth of damage.

  11. So, Mr Sants, you were persuaded that you were the best person to take forward the regulatory reform programme and leave the regulatory regime in a good shape.

    Okay, with not very long to go before you take up your new role as head of the PRA, in what sort of shape would you describe the FSA currently to be?

    Looking back, for example, at the Barclays/Aviva mass mis-selling debacle, which resulted only last year in victims demonstrating outside Parliament calling for the FSA to get up off its backside and force Barclays to start Treating its Customers Fairly, would you consider that you’ve achieved your objective?

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