Northern Rock supervisors have left, FSA confirms
Monday, 10 Mar 2008 16:07
FSA confirms several officials on Northern Rock team left in lead-up to crisis
The Financial Services Authority (FSA) confirmed five of the seven officials supervising Northern Rock have quit.
The FSA said the staff were supervising activities at the bank in the 19 months before the crisis hit but would not say when the team members left.
The news follows a Freedom of Information request from the Times newspaper, which suggested none of the supervisors had been fired, as there was no compensation paid.
The Times report implied high staff turnover may have been a factor in the failure of the FSA to spot flaws in the bank's operations.
The regulator has been attacked for its role in the Northern Rock crisis, which saw the first run on a UK bank in over one hundred years.
Northern Rock was bailed out with Bank of England loans after its over-reliance on the wholesale markets led to a cash-flow emergency during market turmoil last August.
FSA head Hector Sants admitted last month the FSA was aware of the risks Northern Rock was running but failed to communicate its concerns with the bank's management.
A report due out next month will review the financial watchdog's conduct leading up to the problems at the bank.