Davies drafts old guard into new City regulator

The financial services mega-regulator, SuperSIB, came a step closer yesterday after the chairman, Howard Davies, named his key deputies. All three are currently with regulators.

Tom Stevenson, Financial Editor, reports on the creation of the new City watchdog.

The new unified City regulator began to take shape yesterday after Howard Davies named three managing directors to work under him, drawing exclusively on existing regulators to fill the posts.

He also clarified the structure of the enlarged financial services watchdog, confirming that the system of regulation by type of institution was to be ditched in favour of supervising different functions across all types of business.

Dubbed SuperSIB by the media and known as NewRO internally, the new watchdog will not be named officially until the end of the month when the new organisation will be formally launched and its new executives introduced.

By opting for a flat management structure, with no chief executive, Mr Davies found senior positions in the new organisations for the key figures in the self-regulatory organisations that will be replaced by SuperSIB.

He deliberately avoided the creation of a chief executive's position in order to maintain the loyalty of senior regulators who might otherwise have been unwilling to give up their existing fiefdoms for what they perceived to be smaller jobs.

The only surprise omission from yesterday's line-up was Securities and Investments Board chief executive Andrew Winckler, who leaves SIB at the end of the year. Like Colette Bowe, head of the Personal Investment Authority, Mr Winckler decided against swapping the top job at an existing regulator for a second-tier role in the enlarged watchdog.

The three managing directors named yesterday are:

Richard Farrant, head of the Securities and Futures Authority, who will chair SuperSIB's management committee and be directly responsible, as chief operating officer, for the regulator's internal operations, including human resources and finance.

Michael Foot, the Bank of England executive director responsible for banking supervision, who will head up a new financial supervision function encompassing all types of institutions.

Phillip Thorpe, who has headed the Investment Management Regulatory Organisation (Imro). He will lead an authorisation and enforcement division and take on responsibility for consumer relations.

Gordon Brown, Chancellor of the Exchequer, and Eddie George, the Governor of the Bank of England, said yesterday they planned to make the appointments to the SIB board before Royal assent was given to the Bank of England Bill, which stripped from the Bank its supervisory role.

Once that bill is passed, expected to be in the spring of next year, the SIB board will become responsible for all regulation. The existing self-regulatory organisations will, however, not be officially rolled into SuperSIB until a new financial services act is passed, which might not be until 2000.

Mr Davies said yesterday that two-year transition period presented risks, but he said it was a better alternative to leaving the SROs independent. Wrapping the front-line regulators in informally would reduce the risk of staff leaving or firms dragging their feet on enforcement issues because they felt they were dealing with a lame duck regulator.

The appointments were being seen yesterday as a neat solution to a potentially difficult combination of high-profile appointments. Observers said Mr Farrant was being rewarded for running arguably the best-managed SRO, while Mr Thorpe's appointment was viewed as an appropriate prize for his deft handling of the Peter Young scandal at Morgan Grenfell in which he ensured that thousands of investors were promptly compensated.

It is thought that success, together with a series of stiff fines for regulatory transgressions, gave the 43-year-old former barrister from New Zealand the edge over Ms Bowe, whose PIA has struggled to enforce adequate redress for the pensions mis-selling scandal.

As well as running the SFA, Mr Farrant, 52, has experience of banking supervision at the Bank of England and as an adviser to the Hong Kong Banking Commissioner where he handled a succession of crises at local banks.

Mr Foot, 50, has been at the Bank of England since 1969 when he joined as an economist. His career has included a spell as head of the Bank's foreign exchange division and as the UK's representative at the IMF in Washington.

Other appointments announced yesterday included Oliver Page, a deputy director at the Bank of England, as a director of financial supervision. Martin Roberts moves from the DTI to become director of insurance and friendly society supervision.

Mr Davies said yesterday: "I now have my top team in place. All three bring particular strengths. But the key will be for us to work together as a team. We are fully committed to doing so."

The creation of the new vertical structure replaces the old system in which one office oversaw all aspects of regulation for a particular type of financial business. Mr Davies said the new system had been arrived at after an internal study backed up by outside consultants from McKinsey.

The data shows that the number of “unlawfully” large infant classes has doubled in the last 12 months alone
i100Mike Stuchbery, a teacher in Great Yarmouth, said he received abuse
Arts and Entertainment
The starship in Star Wars: The Force Awakens
filmsThe first glimpse of JJ Abrams' new film has been released online
Rio Ferdinand returns for QPR
sportRio Ferdinand returns from his three-game suspension today
The Speaker of the House will takes his turn as guest editor of the Today programme
arts + ents
ebooksNow available in paperback

Watch the spoof Thanksgiving segment filmed for Live!
Billy Twelvetrees will start for England against Australia tomorrow with Owen Farrell dropping to the bench
rugbyEngland need a victory against Australia today
Arts and Entertainment
The cover of The Guest Cat – expect to see it everywhere
Tyson Fury poses outside the Imperial War Museum in south London ahead of his fight against Dereck Chisora
boxingAll British heavyweight clash gets underway on Saturday night
i100 Charity collates series of videos that show acts of kindness to animals
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Austen Lloyd: Company Secretary

Excellent Package: Austen Lloyd: EAST ANGLIA - SENIOR SOLICITOR LEVEL ROLE** -...

Citifocus Ltd: German Speaking Client Specialist

£Attractive Package: Citifocus Ltd: Prestigious asset management house seeks a...

Citifocus Ltd: Performance & Risk Oversight

£Negotiable: Citifocus Ltd: This is a varied role focusing on the firm's mutua...

h2 Recruit Ltd: Sales Director - SaaS (SME/Channel) - £140,000 OTE

£90000 - £140000 per annum + benefits: h2 Recruit Ltd: Are you a high achievin...

Day In a Page

Homeless Veterans Christmas Appeal: ‘We give them hope. They come to us when no one else can help’

Christmas Appeal

Meet the charity giving homeless veterans hope – and who they turn to when no one else can help
Should doctors and patients learn to plan humane, happier endings rather than trying to prolong life?

Is it always right to try to prolong life?

Most of us would prefer to die in our own beds, with our families beside us. But, as a GP, Margaret McCartney sees too many end their days in a medicalised battle
Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night - is that what it takes for women to get to the top?

What does it take for women to get to the top?

Thomas Cook's outgoing boss Harriet Green got by on four hours sleep a night and told women they had to do more if they wanted to get on
Christmas jumper craze: Inside the UK factory behind this year's multicultural must-have

Knitting pretty: British Christmas Jumpers

Simmy Richman visits Jack Masters, the company behind this year's multicultural must-have
French chefs have launched a campaign to end violence in kitchens - should British restaurants follow suit?

French chefs campaign against bullying

A group of top chefs signed a manifesto against violence in kitchens following the sacking of a chef at a Paris restaurant for scalding his kitchen assistant with a white-hot spoon
Radio 4 to broadcast 10-hour War and Peace on New Year's Day as Controller warns of cuts

Just what you need on a New Year hangover...

Radio 4 to broadcast 10-hour adaptation of War and Peace on first day of 2015
Cuba set to stage its first US musical in 50 years

Cuba to stage first US musical in 50 years

Claire Allfree finds out if the new production of Rent will hit the right note in Havana
Christmas 2014: 10 best educational toys

Learn and play: 10 best educational toys

Of course you want them to have fun, but even better if they can learn at the same time
Paul Scholes column: I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season

Paul Scholes column

I like Brendan Rodgers as a manager but Liverpool seem to be going backwards not forwards this season
Lewis Moody column: Stuart Lancaster has made all the right calls – now England must deliver

Lewis Moody: Lancaster has made all the right calls – now England must deliver

So what must the red-rose do differently? They have to take the points on offer 
Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

Cameron, Miliband and Clegg join forces for Homeless Veterans campaign

It's in all our interests to look after servicemen and women who fall on hard times, say party leaders
Millionaire Sol Campbell wades into wealthy backlash against Labour's mansion tax

Sol Campbell cries foul at Labour's mansion tax

The former England defender joins Myleene Klass, Griff Rhys Jones and Melvyn Bragg in criticising proposals
Nicolas Sarkozy returns: The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?

Sarkozy returns

The ex-President is preparing to fight for the leadership of France's main opposition party – but will he win big enough?
Is the criticism of Ed Miliband a coded form of anti-Semitism?

Is the criticism of Miliband anti-Semitic?

Attacks on the Labour leader have coalesced around a sense that he is different, weird, a man apart. But is the criticism more sinister?
Ouija boards are the must-have gift this Christmas, fuelled by a schlock horror film

Ouija boards are the must-have festive gift

Simon Usborne explores the appeal - and mysteries - of a century-old parlour game