LONDON (ShareCast) - Alistair Darling is expected to emphasise it is the role of the bank directors to control their behaviour in his annual Mansion House speech this evening rather than advocate new heavyweight regulation.
Despite widespread
criticism that it was light regulation that helped fuel the credit crunch, the Chancellor's speech will focus of improving the quality of people on banks boards and also in regulatory agencies, rather than the system itself.
"Bank boards must have the right people, skills and experience to manage themselves effectively," he will say in the Mansion House speech. "Anyone who thinks that we can carry on as if nothing has happened should think again," he will say.
Darling is also expected to tone down expectations of significant reforms of the UK banking system, with UK banking reform now set to be to a green, or discussion paper.
The government has faced heavy criticism for its role in the credit crunch and especially the ineffectiveness of the tri-partite regulatory system introduced by prime minister Gordon Brown.
That system, brought in while Brown was still chancellor, took sole responsibility for overseeing the UK banking system away from the Bank or England and repalced it with a three ways split with the Treasury and FSA.
Darling's speech, which will come just days after he was widely expected to be sacked by the prime minister in last week's reshuffle, is expected to defend the tri-partite system.
New measures to strengthen corporate governance in UK banks will be presented in the Walker review expected next month, but Darling is likely to hint that this will not involve fundamental reform of the way UK financial institutions are regulated.
Darling's low key comments come amid moves to clamp down on banks elsewhere.
There is a European summit in Brussels soon to reaffirm plans for new European Union-level regulation of the banks, while today President Obama is expected to unveil a new regulatory agency and new powers for the Federal Reserve to tackle bank excesses.
Send Article by Email
Send Article by IM
Blog This with Y! 360
Printable View
