Some banks 'obscuring' who is accountable if things go wrong, says FCA
Britain's financial watchdog says some banks have breached new regulations by "obscuring" which senior managers are "genuinely responsible" if things go wrong.
Consultations conducted by the Financial Conduct Authority (FCA) over the past six months showed that some banks and insurance firms were failing to properly implement the Senior Managers and Certification Regime (SMCR) - which forms part of the regulator's new focus on cleaning up UK banking culture.
The FCA said that most firms provided statements of responsibilities and "responsibility maps" identifying who was ultimately accountable.
However, "in some cases, the FCA has seen evidence of overlapping or unclear allocation of responsibilities. In other cases firms appear to be sharing responsibility amongst more junior staff, obscuring who is genuinely responsible.
"This goes against the intent of the Senior Managers and Certification Regime and must be addressed," the FCA said.
The SMCR was originally implemented in March 2016 for all banks and building societies, with a parallel regime in place for insurers.
The regime will be rolled out across all other regulated financial services in 2018.
Andrew Bailey, chief executive of the FCA, said: "Knowing who is responsible for what is critical for firms and regulators and we have seen genuine engagement on this from the board down.
"Generally, we have observed that firms are taking their responsibilities seriously and have broadly got the regime right.
"But we recognise culture change takes time and there is still more to do.
"So we have to keep a watchful eye on the progress firms are making."