A report from the Bank of England and the Financial
Services Authority has suggested that up to 10 executives that worked
for HBOS should be banned from working in the City in the future. The
named executives include Andy Hornby, HBOS's former chief executive, and
Lord Stevenson, its former chairman.
The report suggests that the executives did not take
enough action to ensure against any possible collapse in the financial
markets which led to HBOS requiring a Government bailout at the start of
the financial crisis in 2008.
Moreover, the report suggests that the Bank of England's own regulatory body at the time did not investigate the issues with enough stringency and relied too heavily on information from senior managers within organisations like HBOS.
For students of A Level Economics, this report offers examples of both market failure in the financial markets and the impact of regulatory capture (where the regulatory body of a market are too closely linked to the decision making of the management and ownership of the firms within that industry and therefore unlikely to act fully in the public interest).
Click here for the BBC article on the report.
Read more (Tutor2u)
Moreover, the report suggests that the Bank of England's own regulatory body at the time did not investigate the issues with enough stringency and relied too heavily on information from senior managers within organisations like HBOS.
For students of A Level Economics, this report offers examples of both market failure in the financial markets and the impact of regulatory capture (where the regulatory body of a market are too closely linked to the decision making of the management and ownership of the firms within that industry and therefore unlikely to act fully in the public interest).
Click here for the BBC article on the report.
Read more (Tutor2u)
