British Regulators to Probe Former HBOS Senior Managers
January 28 2016 - 6:05AM
Dow Jones News
By Ian Walker
LONDON--The U.K. Financial Conduct Authority and the Prudential
Regulation Authority said Thursday they plan to start
investigations into certain former senior managers of failed bank
HBOS, to determine whether action should be taken, without naming
them.
The decisions follows a report by Andrew Bailey, chief executive
of the PRA, regarding the Financial Services Authority's
enforcement actions following the failure of HBOS. This report
recommended that the FCA and PRA should consider whether any former
HBOS senior managers should be the subject of an enforcement
investigation.
The regulators said they would continue to review material with
a view to making further decisions regarding other former HBOS
senior managers.
Last November the regulators said they were considering banning
former officials of bailed out bank HBOS from working in the
finance industry, as authorities continued to press for top
executives to be held accountable for one of the most high-profile
banking collapses from the financial crisis.
At the height of the crisis, HBOS was merged with Lloyds Banking
Group PLC (LLOY.LN), following an ill-judged lending binge. The
U.K. government subsequently invested 20.5 billion pounds ($29.03
billion) to rescue Lloyds.
Last November Mr. Bailey said "the board and senior executive
management of HBOS failed to set an appropriate strategy, and also
failed to challenge a flawed business model that placed
inappropriate reliance on continuous growth without due regard to
the risks involved."
He said back then that the PRA and the FCA will decide whether
several former HBOS officials should be banned from the
financial-services industry, a move recommended by Andrew Green, a
lawyer who was commissioned to write an independent report on
earlier regulatory investigations into HBOS's failure.
(Margot Patrick and Max Colchester contributed to this
article.)
-Write to Ian Walker at ian.walker@wsj.com; @IanWalk40289749
(END) Dow Jones Newswires
January 28, 2016 05:50 ET (10:50 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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