Journal of Banking Regulation

, Volume 13, Issue 1, pp 24–35 | Cite as

Single or twin? The UK financial regulatory landscape after the financial crisis of 2007–2009

  • Alison Lui
Original Article


The author aims to analyse the weaknesses of the Financial Services Authority (FSA) and the Bank of England during the financial crisis of 2007–2009. She aims to discover whether the coalition government's proposal to a twin-peaks model is a better alternative to the single regulator. The focus of this article is on micro-prudential regulatory failures in the United Kingdom. A comparison will be made with the twin-peaks regulatory model in Australia where there were no bank failures. The article is based on an analysis of recent papers and reports. Descriptive statistics are used to provide an insight into the financial ratios of the top banks in the United Kingdom and Australia. A comparative legal analysis between the United Kingdom and Australia is used to reflect the common law system used by both. The structure of the UK regulator was only a minor contributory factor to the financial crisis. The main regulatory and supervisory failures are due to organisational and management problems. There needs to be better information flow, coordination, cooperation, engagement with banks and stricter internal controls. The new UK regulator also needs to be prepared for the changes on the European dimension, following the de Larosiere report. This article will have policy implications for practitioners and policymakers on national, European and international dimensions. Changes in the European regulatory structure will see an emphasis on vertical regulatory cooperation. By first reviewing the weaknesses of the FSA in the light of Northern Rockand HBOS and then comparing the FSA with the Australian regulatory model, this article provides a new insight into financial regulation.


financial regulation twin-peaks model Financial Services Authority single regulator financial crisis financial stability 


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Copyright information

© Palgrave Macmillan, a division of Macmillan Publishers Ltd 2011

Authors and Affiliations

  • Alison Lui
    • 1
  1. 1.Liverpool John Moores UniversityLiverpoolUK

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