Bank hesitant to admit mistakes, says FSA

30 November 2010

Britain's Financial Services Authority (FSA) has criticised the country's central bank for being slow to admit to mistakes made in the run-up to the banking crisis of 2008.

Speaking to parliament's Treasury Select Committee yesterday (November 23rd 2010), FSA chief executive Hector Sants said the Bank of England (BoE) had acknowledged its errors, but as part of a "more elaborate and lengthy process".

"The level of communication, the level of interest in the central bank on financial stability issues, I think, was recognised by all to be very low in the pre-2007 period," Mr Sants told the panel.

He added that the FSA - which is poised to be broken up and replaced with a new regulatory authority - had adopted "more straightforward" methods than the BoE to help identify and rectify any blunders.

Earlier this month, Man Group boss Peter Clarke hit out at the decision to scrap the watchdog in an interview with the Financial Times, implying that it could lead to uncertainty among banks and hedge funds.

By Gary Cooper

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