The actions of the UK’s Financial Services Authority during the Northern Rock crisis last year were “not acceptable to either myself or the FSA,” the group’s chief executive, Hector Sants, wrote in the UK watchdog agency’s annual report.
“I regret that the standard of supervision of Northern Rock in the period leading up to the market instability late last summer was not acceptable to either myself or the FSA,” Sants wrote. “We are determined to put this right. In response to the findings of our Internal Audit review of the issue, we immediately put in place a supervisory enhancement programme which will ensure that in future our supervision is effective across the organisations we regulate.”
The report, which was released on 30 June, also noted, however, that the FSA had met 96 of the 100 goals it set for itself in the previous year.
“I am determined that the FSA will not be defined by the Northern Rock incident, but rather by our response to it,” Sants wrote. “Like any thoughtful organisation, we cannot and do not claim infallibility.”
The full text of the 2007/08 annual report is available on the FSA website at http://www.fsa.gov.uk/pages/Library/corporate/Annual/ar07_08.shtml.