Senior Managers Regime

Held on Friday, October 23

With support from Nabarro


  • Andrew Bailey (Bank of England)

  • Sir Malcolm Williamson (Aviva / CSFI)

  • Carol Sergeant (Danske Bank / CSFI)

  • Philip Augar

  • Alasdair Steele (Nabarro)


David Lascelles, senior fellow at the CSFI, talks to Carol Sergeant about the Senior Managers Regime.


The 2013 Banking Reform Act gave the PRA and FCA the power to punish individual senior managers when a bank breaches a regulatory requirement. It also created a separate offence which could result in individual senior managers being held personally liable for “reckless decisions leading to the failure of a bank”.

The final rules on the new Senior Managers Regime were published by the PRA and FCA in July, and they have the potential to make life uncomfortable for those who are affected – not only in banking, but also in building societies, asset management and (to some extent) in insurance.

But who is going to be affected? The FCA has said that 11,000 people from the banks and building societies will be designated “senior managers”, while a further 63,000 would be “certified persons”, subject to less stringent rules. But that seems to conflict with other reports suggesting much smaller numbers.

Whatever, there is considerable unease about the criteria for inclusion, the penalties and the apparent “reversal of proof”, which will require senior managers to demonstrate that they could not have been expected to know about a regulatory breach. Not surprisingly, there have been assertions that firms won’t be able to find NEDs willing to serve, that experienced managers will simply walk away etc. etc. We are, therefore, delighted that Andrew Bailey – the Deputy Governor of the Bank of England for prudential regulation, and the CEO of the PRA – has agreed to come and explain what the SMR is, is not and is intended to achieve.

We are also delighted that two senior bankers from our own Governing Council will lay out their concerns:

  • Malcolm Williamson has held a number of senior City posts, including Group CEO of Standard Chartered, President and CEO of Visa International, and Chairman of (among others) CDC Group, Britannic and Friends Life. He is currently the senior independent NED at AVIVA.

  • Carol Sergeant is a former MD of the FSA and Chief Risk Officer of Lloyds Bank. She is currently a NED Danske Bank A/S, Secure Trust  Bank and Tullett Prebon, and chairs the whistle blowing charity Public Concern at Work.

In addition, Philip Augar will be adding his two penn’orth. Philip currently holds a non-executive position at KPMG and until recently was a board member at TSB. He is a prolific author of books and articles on finance (including “The Death of Gentlemanly Capitalism”). He previously served as head of NatWest’s global equity and fixed income division and as a managing director at Schroders.

Finally, our host for the day, Alasdair Steele, a partner at Nabarro, will be walking us through some of the legal implications of the new rules.

This is an important and controversial area, and I very much hope that we will be able to shed some light on how the regime is going to work.