Standard Chartered chief executive Peter Sands has waded into the row over the direction of global banking regulation, stating the cost of increased supervision will be borne by consumers.

Sands told the Financial Times that policyholders would bear the cost of higher capital and liquidity requirements and were ‘kidding themselves’ if they believed different.

‘The reality is that a lot of incremental cost will just get passed on to their customers in terms of increased pricing,’ said Sands.

‘This is not a risk-free, cost-free game here.’

The Treasury Select Committee yesterday warned against a ‘hasty’ adoption of a European super-regulator. In a report the MPs said there was ‘serious cause for concern’ about the size and composition of a European Systemic Risk board.

Sands also commented on the plan to give the Financial Services Authority power to tear up bank bonus contracts that it feels threaten economic stability – due to be announced tomorrow in the Queen’s Speech.

He warned that it could ‘undoubtedly harm London as a global financial centre’ and that there was evidence that bonus restriction measures outlined by the G20 leaders in September were already affecting competition as European had implemented them more swiftly than elsewhere.

‘It seems to be impractical and contrary to the government’s intention of trying to move forward in a globally co-ordinated fashion,’ Sands told the FT.