On 6 March 2018 I laid a direction before Parliament using the powers conferred by sections 77(1) and (2) and 78(5) and (6) of the Financial Services Act 2012 (“the Act”), to require that the Prudential Regulation Authority (“the PRA”) should undertake an investigation into supervision of the Co-operative Bank plc between 2008 and 2013. The direction required that the PRA appoint an independent person to undertake the review and that the review should be completed within one year. The PRA appointed Mr Mark Zelmer, a former Deputy Superintendent of the Office of Superintendent of Financial Institutions, Canada, and previously a senior official at the Bank of Canada, to undertake the review.
The PRA presented the completed report setting out the findings of the review to HM Treasury on 4 March 2019. In accordance with section 82(6) of the Act I have today laid the report before Parliament. Copies of the report are available in the Vote Office and Printed Paper Office and as required by section 82(2) of the Act the report will also be published on the Government website.
The report makes detailed recommendations for the PRA and the Bank of England (“the BoE”) relating to supervisory policy and practice. The PRA and the BoE welcome the Report’s recommendations and have today published a document responding to them.
The Financial Conduct Authority has also welcomed the report. While the report contains no formal recommendations for HM Treasury, Mr Zelmer observes that in future relevant authorities should continue to engage early and regularly on firm-specific issues where necessary. The Treasury agrees with this observation, while ensuring that we continue to respect the independence of the regulators.
I would like to thank Mr Zelmer for his work in undertaking the review and producing this report.