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Banks: Directors

Volume 487: debated on Monday 9 February 2009

To ask the Chancellor of the Exchequer if he will review the law on banking as it relates to (a) the fiduciary duties of directors and (b) the penalties for acting in ways which are negligent or reckless. (250208)

[holding answer 22 January 2009]: It is important that any shortcomings identified in the management of banks are addressed to ensure proper governance of UK financial institutions.

Recent improvements in practice and supervision include the changes proposed to the FSA’s approved persons regime (CP08/25) that will better allow the FSA to assess the fitness and propriety of directors of parent holding companies that control major UK banks. The fiduciary duties of directors and the consequences of breach of these duties are set out in company law.