The FSA has released details of a management restructure described by Hector Sants as “the first step on the road to becoming two separate regulators.”
The FSA has released details of a management restructure described by chief executive Hector Sants as “the first step on the road to becoming two separate regulators.”
In June last year, Chancellor George Osborne announced at the annual Mansion House dinner that the FSA would be formally closed by 2012 – to be replaced by the Prudential Regulation Authority and the Consumer Protection and Markets Authority.
A transitional framework, which begins on April 4 and will cost £12.3m to implement, will see the Supervision and Risk business units replaced with a Prudential Business Unit and a Consumer & Markets Business Unit.
The changes will lead to a management shake-up, with the Bank of England executive director for banking Andrew Bailey joining the FSA as deputy head of the prudential business unit under Sants. The newly created CMB will be headed by Martin Wheatley, (who was recently appointed as chief executive of the Consumer Protection and Markets Authority), when he joins in September.
The CMB will be divided into five business divisions. Alexander Justham becomes head of Markets, Sheila Nicoll head of Policy, Clive Adamson head of Supervision and Graeme Ashley-Fenn head of Authorisations. The Consumer Affairs brief has yet to be assigned. Alongside the CPMU, the Prudential Business Unit will be overseen by chief executive Hector Sants with the Operations unit headed by Lesley Titcomb.
FSA internal audit director Rosemary Hillary will be responsible for the supervision division until April following the departure of Jon Pain. FSA director Lyndon Nelson will take responsibility for the risk division following the announcement Sally Dewar has taken up a role with JP Morgan.
Regulated firms will be informed in April whether they will be supervised by the consumer and markets or the prudential business unit. The Treasury will consult on the legislation required to transfer regulatory power to the CPMA and PRA from the FSA, said Sants.
Sants says: “The April 4 reorganisation begins a gradual process of change to ensure we are ready in 2012 to cut over to the twin peaks approach.
“There will, however, have to be some reprioritising of our workplan to ensure due regard to our need to focus on the transition. This will mainly be achieved by reducing some of our routine supervisory activity.”