Treasury confirms independent Co-op Bank inquiry
THE Government has confirmed that an independent inquiry will be held into the actions and governance of the crisis-torn Co-operative Bank.
First mooted in Prime Minister’s Question Time on Wednesday, a statement this afternoon from HM Treasury said Chancellor George Osborne wants the inquiry to examine “events at the Co-op Bank and the circumstances surrounding them”.
The investigation will cover 2008 to the present day and will look at the appointment of senior staff and also acquisitions.
The Manchester-based lender has had a turbulent year and is in the late stages of a life-saving £1.5bn rescue bid after being hit by a host of one costs and provisions for bad loans relating to its acquisition of the Britannia Building Society.
The inquiry will be led by an independent individual, who will be appointed by the two financial regulators the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) – which both agree there is a public interest in a statutory investigation.
The Treasury said the FCA and PRA have today separately announced they are both considering whether they should also launch formal enforcement investigations.
As a result the independent investigation under the Financial Services Act will therefore not start until it is clear it will not prejudice any actions the relevant authorities may take, including the potential FCA and PRA enforcement investigations.
In a statement about the launch of the inquiry The Financial Conduct Authority said it “fully agrees that the investigation should be led by an independent person, and looks forward to supporting them in their work.”
It added: “The timing of the investigation must not prejudice any other criminal or regulatory proceedings. The FCA is already undertaking work to establish whether it should commence a formal enforcement investigation and expects to reach a conclusion shortly.”
Earlier, it emerged that former Co-op Bank chairman Paul Flowers has been arrested is being quizzed by police amid a drugs investigation.
The Co-operative Bank and Group said they would “co-operate fully” with the inquiry.
