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Turner tells societies to stick to their knitting

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FSA chairman Lord Turner has told building societies to “stick to their knitting” and not extend beyond their core services.

He told the Treasury select committee on Tuesday that building societies should avoid getting involved in riskier product areas.

He said: “I think the biggest mistake we made was to allow our mutual sector, in some cases, to extend beyond the core business of prime real estate lending.

“I think there is an unfinished part of our regulatory agenda as to whether we should reverse some of the liberalisation of the building society rules which took place in the 1980s and 1990s.

“In relation to building societies, which are organisations which can only have a skill set across a limited range of activities, they should stick to their knitting.”

FSA chief executive Hector Sants told MPs there are “two or three” firms currently applying for retail banking licences.

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Comments

There are 7 comments at the moment, we would love to hear your opinion too.

  1. There is a saying that people in glass houses should not throw stones.

    Lord Turner would do well to heed this advice

  2. Pity Mr Turner is not up to taking his own advice.

  3. The arrogance of these men is matched only by their ignorance of the industry they are suppossed to regulate. They obviously have a mandate for large UK banks and I wish they would state what and why this is. All evidence regarding the legality and functionality of RDR proposals has been slammed effectively. They have not answered for the FSA’s past failings and inspire no confidence that they will stop wasting money. Instead they cause insult, de-motivate and and try to cloud some extremely biased, destructive and ill thought out policies. I am really sick of their ignorance and ego’s. Ditch the spin Dr Mr Sants, your swallowing your own spin.

  4. I commend you, Lord Turner, to the Statutory Code of Practice for Regulators which should, I hope, afford you a large measure of insight as to just how the FSA should be going about its business rather than forever telling other people how they ought to be going about theirs.

    But then you already know about the Code, don’t you? It’s just that you and the FSA choose to ignore it and nobody holds you to account.

  5. TSC can smell failure 26th November 2010 at 11:44 am

    This comes from an FSA that rather than giving general instructions wants to micromanage monitors and assesses every aspect of the small IFA business. I think the FSA should stick to its knitting and actually do some regulation …for a change. The FSA is way past its sell by date – time to move on. The TSC can smell failure! We must make sure the FSA is not allowed to reinvent themsleves under a new name or their policies like they are doing with the RDR Implementation Committe and the bias advice they are giving Mark Hoban MP

  6. Sorry why should a large mutual building society have less skills than the multinational banks that got us all in the mess we are now in.

    Is this more evidence of the FSA being in awe of the large banks?

  7. Neil F Liversidge 26th November 2010 at 6:03 pm

    Would it not be a good idea to advise the banks likewise? Then they might stop abusing the availability of their current account information to try and flog my clients bonds on which they aim to take 8.5% commission, regardless of (un)suitability. Don Corleone said “A man with a briefcase can steal a hundred times more than a man with a gun.” Several men with a bank each, on the other hand, (step forward Adam Applegarth, Fred the Shred et al) can steal £67bn at the last count, and that’s only in the UK.

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