Banks face more scrutiny under new PRA

Author: Gemma Varriale | Published: 23 May 2011


Hector Sants, head of the Prudential Regulatory Authority (PRA), has reiterated that there will not be a return to light touch regulation for the UK banking system.

Sants explained the philosophy and functions of the PRA, which will be responsible for supervising banks from 2013 onwards.

"This is about a potentially different style of regulation," said Jonathan Herbst of Norton Rose. "It is more senior and more judgement-based."

Peter Green, a partner in the capital markets practice of Morrison & Foerster, commented that this is not a surprising development, considering the concerns that have been raised about the previous supervisory approach of the Financial Services Authority (FSA).

"The financial crisis...