THE City was jolted yesterday as the Financial Services Authority’s chief executive Hector Sants announced he will quit in June and will not now take up the same position next year at the FSA’s successor.
Sants was chief executive-designate of the new Prudential Regulatory Authority, monitoring company-specific risk under the aegis of the Bank of England, as well as deputy governor‑designate of the central bank.
But both these holes will now be left to fill after an abrupt development that is seen as complicating the inplementation of the new financial regulatory system.
The FSA, whose investor protection work will be done by a separate new Financial Conduct Authority in the new system, said the BoE’s Andrew Bailey will take over Sants’s role in the meantime in running the part of the current regulator that will become the PRA. Sants, who has been at the organisation for eight years, five as chief executive, said: “I am proud of what the FSA has achieved during my time in charge, through incredibly challenging times.”
Chancellor George Osborne and FSA chairman Lord Turner both paid tribute yesterday to an “outstanding public servant”, who had done invaluable work in overseeing planning for the transition to the new regulatory structure.
Sants was paid £800,000 last year, including a performance-related bonus. However, as a former Credit Suisse banker, analysts said he could earn substantially more if he returns to the private sector.
His departure from the FSA follows that of the regulator’s top enforcer Margaret Coles, who pushed through hardline pursuit of financial wrongdoing as the watchdog tried to ditch its reputation for “light touch regulation”.