Banking regulator under fire for report decision

The Financial Services Authority (FSA) will be publishing a report on the collapse of RBS during the banking crisis and one into the downfall of Halifax Bank of Scotland (HBOS) to help identify what went wrong.

But the regulator has told the Treasury select committee it will not produce the same public information reports into Bradford & Bingley or Northern Rock, both of which were nationalised during the economic meltdown.

Bradford & Bingley’s branches were sold off to Santander and its troubled mortgage book nationalised.

The FSA said it did not want to create a precedent that all bank failures are followed by public reports, and said other institutions were smaller than HBOS.

“None is therefore likely to reveal lessons essential to our understanding of the causes of the crisis nor of the steps needed to ensure better regulation and supervision in the future,” said FSA chairman Adair Turner.

“Our judgement is that the public’s legitimate interest in understanding the key drivers of the 2008 financial crisis will be effectively served by the publication of reports on RBS and HBOS, together with the earlier report which we produced on Northern Rock and my own review on the overall regulatory system.”

But Treasury select committee member Stewart Hosie said MPs were “surprised”, adding: “The committee collectively were rather disappointed at how quickly the FSA dismissed the possibility of learning anything from a thorough investigation into Bradford & Bingley and Northern Rock.

“One would have imagined there were still valuable lessons to be learned from an investigation into that.”