Government advisers back calls for an investigation into ex-HBOS directors

Billy Bambrough
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Lloyds TSB Merges With HBOS
HBOS was bailed out by the government and Lloyds Banking Group in 2008 but investigations into the banks failures have been delayed (Source: Getty)

Two independent government advisers have backed calls for ex-HBOS directors to be investigated by the regulator.

Last month the Financial Conduct Authority (FCA) and the Bank of England’s Prudential Regulation Authority (PRA) released a report into why HBOS failed.

Iain Cornish and Stuart Bernau told the Treasury Select Committee they supported the conclusions that Andrew Green QC reached in his part of the report that recommended investigations be re-opened.

Cornish, former chief executive of Yorkshire Building Society, and Bernau, a former Nationwide director, were appointed by the Treasury select committee as independent reviewers of the report in March 2013.

So far one executive, former corporate bank boss Peter Cummings, has been sanctioned by the regulator. He was banned from senior jobs in the financial services industry and fined £500,000.

Read more: With the HBOS report published, is banning directors the best way to deal with excessive risk-taking in banking?

Andrew Tyrie, chairman of the committee, has been highly critical of the bank and the now defunct Financial Services Authority (FSA).

Later today the committee will call on the Brian Pomeroy, who joined the FSA after the collapse of HBOS in 2009 and is currently a non-executive board member at the FCA, and Andrew Bailey, the chief executive at the PRA.

The committee is expected to ask them how regulation has been improved, and whether the FCA will move forward with investigations into HBOS management.

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