FSA pledge after Rock blunders

My Account
Logout

Create an Evening Standard Account

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Welcome! Sign in here

Use your social network

Save time by using your existing account to sign in to Evening Standard

We'll never share your information or post anything to your account without your permission

Forgot your password ?

Registration

* indicates fields that are mandatory

Email *

Password *

Confirm Password *

First name *

Surname *

Postcode *

Country *

Mobile phone number

Username *

Gender *

Year of birth *

When you sign up...

You will have access to all our online competitions, discounted offers and can post comments on our site.

You will also receive The Weekender newsletter sent every Thursday - it’s full of fantastic offers and ideas for the weekend. You can update your email preferences in your account page when you log in.

Other newsletters and emails

Homes & Property Newsletter - Yes I want to receive the weekly email with all the latest news on property in the capital

Occasionally we would also like to send you relevant emails detailing specific offers either from ourselves or carefully selected partners. If you would prefer not to receive these then please tick the appropriate boxes below. We will never pass on your details.

I do not want to receive additional offers and information from the Evening Standard

I do not want to receive additional offers and information sent by Evening Standard on behalf of carefully selected partners

Terms and Conditions

* I have read, understood and agree to be bound by the terms and conditions of Evening Standard

Registration

Mail Sent for Registration Confirmation.

A confirmation email has been sent. Please activate your account by clicking on the activation link sent in your mail box.

The Financial Services Authority (FSA) said its supervision of the now-nationalised group was unacceptable in a long-awaited internal report into the Northern Rock debacle.

The FSA owned up to having too few regulators assigned to monitor Northern Rock and a "lack of oversight and review" by FSA line management.

FSA bosses said they would recruit around 100 extra staff to boost its supervisory teams in an attempt to guard against another Northern Rock crisis.

The bank was forced to go to the Bank of England for emergency funding last autumn when its funding lines dried up amid the credit crunch. Its funding troubles panicked depositors, with thousands queuing up to withdraw money in the first run on a UK bank in more than 140 years.

Hector Sants, chief executive of the FSA, said: "It is clear from the thorough review carried out by the internal audit team that our supervision of Northern Rock in the period leading up to the market instability of late last summer was not carried out to a standard that is acceptable."

The FSA's report outlined a number of failings in processes and staffing. It said there were continuity problems with the managers responsible for supervising the bank, with three different heads of department in the role during two-and-a-half years.

The FSA also admitted that none of the heads of department had met Northern Rock since January 2005, despite managers on average meeting one of the firms under their charge every week.

Northern Rock was meanwhile initially supervised by a department whose primary responsibility was for insurance and not banking groups, the report found. And it was the only firm classed as high impact - those firms with the biggest potential for systemic damage should they fail - not to be issued with a so-called "risk mitigation programme".

The FSA said that alongside the recruitment of more staff, it would seek to give greater priority to the task of supervising individual firms, with more involvement of senior management in the process.