City regulators have cleared former bosses of HBOS of misconduct in the lead-up to its near-collapse in 2008, despite previously having blamed the bank’s board for its failure.
The Bank of England and Financial Conduct Authority (FCA) said on Friday that they had concluded “rigorous and forensic investigations” into unnamed former managers, after gathering more than 2m documents, interviewing former bank managers, and undertaking “substantial analysis” of the bosses’ roles and responsibilities at what was then the country’s biggest mortgage lender and savings institution.
However, the watchdogs said their six-year investigation –which was originally expected to last a year – had determined that there were no grounds for action against former bosses.
Only one HBOS executive, the former head of the commercial banking arm, Peter Cummings, has been punished after the saga. Cummings was banned from working in the City by the former regulator the Financial Services Authority and fined £500,000 in September 2012.
This is despite both the Bank of England and FCA having previously published a report in 2015 on the bank’s failings, which concluded that “ultimate responsibility for the failure of HBOS rests with its board”.
The regulators were subsequently compelled to open their investigation into HBOS’s leadership after a separate report by Andrew Green QC, who in 2015 concluded it was in the public interest that action against former bosses be reconsidered. Green has described the FSA’s decision not to pursue bosses — including chair Lord Stevenson, the former finance chief Mike Ellis, as well as former chief executiveAndy Hornby – as “materially flawed”
Ellis retained a senior banking role after leaving HBOS, serving as chair of
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