Hector Sants’ number two at the Financial Services Authority (FSA) has become the second high-profile casualty of chancellor George Osborne’s wholesale changes to banking regulation.
Managing director of supervision Jon Pain will join risk manager Sally Dewar in quitting the FSA. Pain leaves after it emerged Sants will keep his job while the FSA is wound down. Sants will then join the Bank of England as a deputy governor.
An FSA insider told City A.M. Pain is stepping down after realising his job will no longer exist under the FSA’s new structure.
The source said: “At the point of restructure it became clear to Jon his job would no longer exist – it’s as simple as that. The new internal structure just won’t offer the same scope for a job of Jon’s power. It’s a personal decision and he has not been pressurised from above.”
Pain will leave the organisation next year as the watchdog’s powers start being shifted to the Bank.
Last week Osborne announced he will scrap the FSA in two years and make Bank governor Mervyn King one of the most influential central bankers in the world. A new prudential regulator, working under the auspices of the Bank, will replace the FSA in 2012.