UK Announces Overhaul of Banking Systems

UK has announced on Wednesday a radical overhaul of the country's financial system by 2012.

British Chancellor of the Exchequer George Osborne has announced on late Wednesday a radical overhaul of the country's regulatory structure that involve moving regulatory functions of the Financial Services Authority (FSA) to the central bank, the Bank of England, Xinhua reported.

In his address at the Lord Mayor's annual dinner Wednesday, Osborne outlined a new regulation policy to reform the financial system by 2012 that will abolish the FSA and do away with the tripartite system of regulation introduced by Gordon Brown in 1997.

A new regulator will replace the FSA and report to the Bank of England which will have oversight of banks, investment banks, building societies and insurance companies.

The new regulator will act as an early-warning system for future financial crisis, he said.
It has been the most important reform of the financial supervision system in 13 years, said analysts.