Andrew Tyrie MP: the man scrutinising regulation of banks

Mr Tyrie is without a shadow of doubt the best man for the job of scutinizing what lesser mortals might want to do in the name of regulation. I would hope that he carries enough weight, if not the binding power, to ensure that the architects of all previous failed attempts do not allow this country to go through what it has over the last two and a half decades, the catastrophes get bigger and more damaging as time goes by so it cannot be simply a matter of needing a new piece of legislation, we need strong management and removal of the civil service 'departmental' attitude where the ones put in charge have no control over the ones who are supposedly under him/her.

What they want to do is to separate the bank from the ordinary deposits and let the investment ( casino )part stand on its own.If the casino fails too bad.The ordinary cheque account customer is safe.If it does go ahead and they have to stand by the lose they might not be too cleaver after all

a minor element of confusion.."bank capital, balance sheets, living wills, something on subordinated debt and structure,’ said Tyrie. ‘What they should be and how they relate to each other is a crucial part of the debate which we will want to engage with.’ '

Now how "living wills" becomes sandwiched between the other 2 is one I can't quite get to.

Is there anyone out there who can help me ?

I agree with Andrew Reid in spirit; I wonder however if, in the battle of giants, size is required? If not, the proposal to insert some form of Chinese wall between the casino and retail elements of a giant bank seem likely to fail unless such a wall is so impenetrable that the bank has, in fact, been split.

What has convinced me utterly of the truth of Dr Cable's recent remarks, to the effect that capitalist ventures like to destroy competition, and big ones do it best, is seeing how banks and building societies operated in the recent past. Witness the Halifax Building Society in the period 1988 through to the collapse of HBOS plc in 2008. Tie-ups with an Endowment Provider (Standard Life) whose products it recommended unreservedly, despite the fact that Standard Life was one of the institutions named and shamed for applying management charges greater than those used in the sales projections provided to customers at the outset, to sell the product.

Acquisition of a chain of estate agencies, Halifax Property Services to sell you the house, and use of a wholly owned surveying subsidiary, Colleys, when its customers wanted a combined Survey and Valuation (noting that the survey Colleys offered was subtly different from the standard RICS House Buyers Report and Valuation) There was also a connection in later years with a firm of solicitors for the conveyancing.They even offered to move you at one point. Halifax would say: "just providing a complete service to the customer" but the potential for conflicts of interest was profound. Halifax Head Office bullied its 1,700 independent surveyors on their panel (Colleys were not always available) into ignoring what the RICS described as "vital restrictions" in the application of a House Buyers Report and Valuation to older houses.

Branches churned endowments (Churn = persuading a customer to surrender a perfectly good endowment and take out a new one, solely for the sake of the commission earned) in an effort to reduce salary costs. Add in mis-selling of PPI etc and you wonder if a big bank can get away with this kind of thing more easily than a small bank which is facing real competition. You then reflect on the breathtaking acquisition, by the unlovely Santander, of hundreds of RBS branches and the now size of Lloyds Banking Group, and think: are we going the right way?

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Someone said if you start to mess about with the banks they will take their talents else were and we will all be worse off.What talents.Banking is easy .You take in 100p and after all expenses you have say 5p left.you will be able to continue.Its the greed they want to wipe out.

Tomothy Burton, Standard Life was not 'named and shamed' until well after the sales of mortgage endowments fell off the cliff. It was me who uncovered this discrepancy between what Standard Life used to produce illustrations and the actual charges which created the built-in shortfall. What did the regulator do about this? It fought tooth and nail to prevent the release of information which would have resulted in the collapse of so many financial institutions who had bought into this Ponzi scheme.

But what has the FSA said about bank charges? Are they fair or not? Technically the FSA said they are unfair, publicly no such admission, no fines, no bans, nothing.

Make no mistake, the British consumer is not protected by regulation, the banks are though. Is this all for the common good? Is it right that the bankers carry on as if nothing had happened? Well, the regulators end up with a big 'banking' jb so why rock the boat?

If anyone can prove to me that splitting the banks up will make any difference then they have my vote, until then perhaps they should leave our shores because we can't afford them, make sure they pay the taxpayer back first!!

Well done Mr Owen. I agree with all that you and Andrew Reid say. I didn't mean to imply that the "naming and shaming" was done back in 1988, and I am aware, profoundly, of how closely guarded was the secret of the higher than advertised endowment management charges. However Standard Life assure me that Halifax were not (then) concerned by the mismatch between Lautro "Standard Charges" used in the projections, and the actual charges (which implies they were aware of it at the time of the product sale) Of course Halifax were not vitally concerned in this matter because, in most cases, their debt was secured by the property - it was the customer who would lose if there was a shortfall.

Why not just go back to the banking rules and regulations that were in operation that were in operation during the 50s 60s 70s and 80s.In the early days of this period Banks were regulated by the Bank of England and if "The Bank" even rang up my old Head office in Spring Gardens Manchester, the Chief General Manager stood to attention. There was no such thing as a bonus, you just got the sack if you got something wrong. Currency dealers bought and sold depending on the customers requirements and arbitrage dealing by converted London Barrow Boys was forbidden. The only person to hold a long or short position was the banks treasurer and that, to say the least, was unusual. In those days banks and their managers were a trusted sector of the community -- Now they rank below Lawyers and that says something. Mr Tyrie should put together a team of half a dozen ex bank inspectors of the old school and I guarantee that within 6 months after a lot of eye watering we would again have a Banking system which was useful and of which we could all be proud.

Andrew Tyrie is my own MP and I rate him very highly; I just hope he can marshal sufficient people to support his clear and common sense approach to life and business. Heaven knows we need clever and sustained effort to dig ourselves out of the current morass.

I agree with above blogs that the RISK side of banks should be separated; and - as always good old Britain has swung too little too late, then panicked into tying down banks and our money, in a way which is illogical and frustrating, to both business and savers.

I never thought to hear those in power demanding that we spend our savings, to get the economy going again. My savings are locked in to providing a safety buffer for my bank. The irony is that the previous administration, (I would not dignify them by calling them a government), spent all our savings and then some.... and look where we are now!

I have sat now, for 18 months with the proceeds of a house sale, in five different banks of course, with minimal interest - so i suppose i might as well spend it, but whether I spend it here or abroad? Hmmmm..

And finally: please can Mr Tyrie (and D Cameron) squash that twerp on the MPC, who shot his mouth off last week about Sterling. Something about 'collective responsibility' perhaps? Otherwise button up chum.

we are all doomed, the FSA has had its day and as part of its last throes has as a dying body, decided to decimate the iFA sector so that it will shrink and allow all those wonderful banking institutions to make more profits, pay more bonuses and shaft more customers.

Unless Parliament steps in, suspends the RDR in total and sets up effective regulatory bodies with proper rules and guidelines for both the public and the industry, it will all come about and result in a depletion of retail investment business, creating a tsunami effect on the economy, drowning innovation and restricting consumer choice.