New York (HedgeCo.Net) – The behaviour and culture within banks played a major role in the 2008-09 financial crisis and in conduct scandals such as Payment Protection Insurance (PPI) mis-selling and the attempted manipulation of LIBOR, the Bank of England said when responding to recommendations made by the parliamentary commission on banking standards.

Under the statutory and regulatory framework in place at the time, individual accountability was often unclear or confused. This undermined public trust in both the banking system and in the regulatory response.

Under the proposed legislation, bankers would be required to meet the following criteria:

• heads of key business areas meeting certain quantitative criteria
• individuals in group or parent companies exercising significant influence on the firms’ decision-making, and
• where appropriate, individuals not otherwise approved as Senior Managers but ultimately responsible for important business, control or conduct-focused functions within the firm.

The proposals in this consultation are intended to create a new framework to encourage individuals to take greater responsibility for their actions, and will make it easier for both firms and regulators to hold individuals to account.