The incoming Bank of England governor Andrew Bailey has defended his record as head of the City watchdog, saying he is “proud of what we’ve achieved” but “not proud of some things that happened”.
Critics say Bailey did not deal adequately with a number of financial scandals that occurred on his watch as chief executive of the Financial Conduct Authority (FCA), such as the collapse of mini-bond firm London Capital & Finance and the gating of Neil Woodford’s investment funds.
The Treasury Committee of MPs today grilled Bailey on these issues ahead of him taking up the role of Bank of England governor on 16 March.
Bailey said: “I think I can honestly say the FCA is a changed organisation. And we have done a lot during my time.”
The next BoE governor said that many problems the FCA faced were due to the fact that it oversees more than 50,000 firms.
“Things have happened that I wish hadn’t happened as we came to grips with these problems,” he said.
Bailey sought to highlight a number of areas where he said the FCA had done good work.
“In a whole range of areas, whether it’s payday lending, rent-to-own, door-to-door lending, overdrafts and a number of others, these are all sectors where we’ve intervened.”
“Our evidence suggests that the reduction in costs to consumers, and particularly vulnerable consumers, is about £1.5bn a year for the poorest people in society.”
However, many MPs on the committee appeared unconvinced. Labour MP Rushanara Ali asked whether Bailey’s weak leadership of the FCA meant bankers and executives “quite frankly took the biscuit”.
Bailey was asked about the embarrassing letter the FCA had to send to staff to warn them about problems such as “defecating on the floor in toilet cubicles” and “leaving alcohol bottles in sanitary bins”.
He said he felt the FCA had to come clean about its issues for the sake of transparency, but said that “other organisations” had got in touch to say that had similar problems.
Of his time at the FCA as a whole, he said: “It’s hellishly tough at times, but that’s the nature of it.
“I went in with my eyes open. As you know it wasn’t a job I applied for but I don’t regret it for a moment.”