Gone is all the vituperative personal criticism of the players in the drama and in its place is a measured and serious piece of work that showed that after a series of inquiries into Johnson Matthey Bankers, BCCI and now Barings the committee is able to get a grip on the technical issues of banking supervision.
The members include Brian Sedgemore, the Labour veteran on the committee who cut his teeth - mainly on the neck of Lord Kingsdown, then Robin Leigh- Pemberton, Governor of the Bank of England - during the mid-Eighties inquiries into JMB.
The committee is extremely critical of the Bank - and deservedly so. The last time the same Lord Kingsdown appeared before it he was to explain how much sharper the supervision department had got at doing its job in the wake of the BCCI scandal. Then Barings happened.
But the committee has drawn back from recommending that the Bank should lose responsibility for supervision, instead leaving it in the air as a threat in case things don't improve. This question of whether to break up the Bank is one that has had even the Labour Party backing steadily away, as it researched the complications of rebuilding the supervision system almost from scratch. The strongest argument in favour has always been that when the Bank's supervision arm fails, it indirectly damages its reputation for conducting monetary policy, something that has taken on more important as the Governor acquires more influence over the Chancellor in setting interest rates.
The committee is right to point out the cultural problem of having the supervisor too cosily close to its charges. Indeed, long term, there is an attractive logic in proposals for a new super regulator covering both securities and banking - two industries that are merging rapidly. But as the MPs' restrained comments show, support for that proposition is now muted on both sides of the house.Reuse content