Sarah Breeden: Climbing mountains safely

Speech by Ms Sarah Breeden, Executive Director of UK Deposit Takers Supervision of the Bank of England, building on remarks given at the PRA Annual Conference for Chairs of the Non-Systemic UK Banks and Building Societies, 6 July 2020, 22 July 2020.

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

Introduction

Today the Prudential Regulation Authority (PRA) is launching a consultation1 on a new guide for banks - a guide that is designed to help new and growing banks scale the mountain from initial authorisation to becoming an established player in the banking market.

The guide builds on the steps we have already taken to lower barriers to entry for new firms, and which over the past few years have helped support real change in the UK banking system. But there is more to do. And we hope these clear expectations will promote continuing competition in the sector by allowing firms to plan a safe route higher up the mountain. As firms plot their path out of the Covid stress, we must do our best to support competition, not risk a return to the ways of the past.

The start of our climb

In the years following the financial crisis, consolidation rather than competition seemed to be the norm.