Chancellor Alistair Darling will this week signal the biggest shake-up of UK’s financial system in a decade, in a response to market conditions and the Northern Rock collapse.
In a speech at Mansion House this Wednesday, Darling is expected to give further details of his plan to strengthen the Bank of England (BoE)’s role in promoting financial stability, including bringing in City experts to advise Mervyn King, the governor, and reforming the bank’s governance, the Financial Times reports.
The chancellor is also expected to reveal details of his plan to give the Financial Services Authority (FSA) new powers to intervene in a failing bank, including the right to seize deposits and bring in new management.
Moreover, Darling is expected to concede to some of BoE’s demands for a more prominent role in overseeing the implementation of these emergency powers.
Further reading:
Overview: FSA - toothless watchdog?
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