Eversheds partner Andrew Henderson has said that the final word on banking conducts remains with the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), despite the launch of the UK Banking Standards Council.
Henderson said: ‘The contents of the Banking Standards Review are not unexpected and its aims laudable. The extent to which it achieves those aims is more difficult to predict because any standard issued by the Banking Standards Review Council will not have the force of law.’
According to Henderson, it is likely that, like other industry standards to which the FCA and the PRA may have regard, the standards will help drive supervisory or even enforcement action.
However, he added, the FCA and PRA will still be required to exercise their own discretion in determining how banks should behave. ‘The council’s views will, no doubt, be important but the law will expect the FCA and the PRA to have the final word.’