Failures in the prudential regulation of banks in the UK and US: will the lessons be learnt?

Clayton, N. A. (2015). Failures in the prudential regulation of banks in the UK and US: will the lessons be learnt?. Law and Financial Markets Review, 9(2), pp. 130-153. doi: 10.1080/17521440.2015.1052669

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Abstract

The prudential regulation of banking is now undertaken by the Prudential Regulation Authority (PRA) within the Bank of England. Previously, such regulation was undertaken by the Financial Services Authority (FSA). It will be the role of the FSA as the previous regulator in the UK that will be considered. This article will examine the lack of understanding on the part of the FSA about the risk to which banks were subject. Insights into the approach and effectiveness of the FSA can be found in an examination of the reports of various parliamentary committees and the evidence of senior officials, employees and management called to give evidence. These committees have investigated various banking collapses and important issues relating to the carrying on of banking business. The reports and evidence of such committees are a reliable and detailed source of information. These reports are evaluated throughout. It will be suggested that the economic position of such banks does have an effect upon their regulation. Analogous reports in the US will be compared and contrasted with the findings in the UK. Changes in regulation, and its enforcement, after the setting up of the PRA will be considered.

Item Type: Article
Additional Information: This is an Accepted Manuscript of an article published by Taylor & Francis in Law and Financial Markets Review on 2 Jul 2015, available online: http://wwww.tandfonline.com/10.1080/17521440.2015.1052669
Subjects: H Social Sciences > HF Commerce
K Law
Divisions: The City Law School > The City Law School - Academic Programmes
URI: http://openaccess.city.ac.uk/id/eprint/12410

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