| Synopsis: |
This is the Government's response to the Parliamentary Commission on Banking Standards report, 'Changing banking for good' (HC 175-I, session 2013-14 (ISBN 9780108551062)). The Commission's final report sets out a compelling case for change and makes over 100 recommendations. The Government agrees with the overall conclusions of the Commission and accepts all of its principal recommendations.Specifically, the Government is announcing that it is planning to: i) strengthen individual accountability by introducing a tough new Senior Persons regime; introducing new banking standards rules to promote higher standards for all bank staff; introducing a new criminal offence for reckless misconduct for senior bankers; reversing the burden of proof so that bank bosses are held accountable for breaches within their areas of responsibility; and working with the regulators to implement the Commission's proposals on pay ii) ask the regulators to implement the Commission's key recommendations on corporate governance iii) support competition in the banking sector by providing the Prudential Regulation Authority (PRA) with a secondary competition objective to strengthen its role; and ask the new payments regulator, once established, to urgently examine account portability and payments system ownership. As already announced, HM Treasury has launched a review of the case for establishing a "bad bank" consisting of some high risk RBS assets. The Office of Fair Trading (OFT) has brought forward its review of competition in the small and medium enterprise (SME) sector.In response to the Commission's other recommendations, the Government has initiated detailed further work to explore the best path for their implementation. |