Tories plan to beef up Bank's role

<div>THE TORIES will hand the power to regulate financial institutions back to the Bank of England if they win the next general election, City A.M. can confirm.<br /><br />Under plans to be announced by shadow chancellor George Osborne before the current parliamentary session ends in late July, the tripartite system of regulators would be overhauled, with the Bank assuming the lead role on supervising financial institutions.<br /><br />The Financial Services Authority would effectively become a consumer organisation charged with ensuring that financial institutions treat their customers fairly and honestly.<br /><br />The Bank would focus on ensuring that financials, including insurers, retained sufficient capital and liquidity to withstand economic strife.<br /><br />The proposals go beyond Bank of England governor Mervyn King&rsquo;s recent call for the Bank to be given more power.<br /><br />King envisaged a power-sharing arrangement with the FSA, led by Lord Adair Turner, who has conceded that he would be &ldquo;agnostic&rdquo; about giving up the City watchdog&rsquo;s supervisory role.</div>