25 November 2013
The Treasury is to conduct an independent inquiry of the Co-op Bank and the circumstances surrounding recent events.
Citing public interest, the statutory investigation will be led by an independent person appointed by the regulators, the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA).
The FCA and the PRA have also announced their intentions of possibly commencing their own formal investigations in to the matter; in light of this, the Treasury has stated its inquiry will be held until it becomes clear to the department that the investigation will not prejudice any actions the FCA and PRA may take.
The Treasury’s inquiry will cover the actions of relevant authorities (regulators and government) and the institution itself, including prudential issues, governance (including the appointment of senior staff) and acquisitions. The period that the investigation will review will start from at least 2008 and run to at least the present time.
The direction and the investigation’s report will be laid before Parliament.
According to the Treasury’s investigation statement, ‘The government is determined to create a stronger and safer banking system. A key part of this is reforming the regulatory regime for senior managers. That is why the government’s Banking Reform Bill, which is currently passing through the House of Lords, will introduce a new senior managers’ regime, subjecting decision makers in banks to higher standards that means if they fail in their duties they will be held to account’.