Sam Woods: Credit union meets robot

Speech by Mr Sam Woods, Deputy Governor for Prudential Regulation of the Bank of England and Chief Executive of the Prudential Regulation Authority (PRA), at the Mansion House, London, 24 October 2019.

The views expressed in this speech are those of the speaker and not the view of the BIS.

Introduction

Earlier this year I gave a speech, which fortunately for most of you in this room you did not have to sit through, on competition. I avoided the temptation to list all of the things we've done to facilitate competition and instead posed a set of seven questions which I think are more awkward for us.

The three-line version of that speech is this: we've done a lot to lower prudential barriers to entry into the banking sector, with the result that we've got a lot of new banks. But have we done enough to lower the equivalent barriers to growth, given no little bank has recently become a really big bank?

Since then I have unleashed the competition team within the PRA to roam about the institution digging up whatever they can find on the barriers to growth issue. They have already come up with two things. First, with the help of a PRA robot they have for the first time been able to map all the barriers, and show how complex our rules are. And second, together with our credit union supervisors they have taken a fresh look at capital requirements for that sector and proposed some quite radical changes in order to promote the growth of successful firms.