U.K. Financial Conduct Authority acting chief Tracey McDermott appealed to insurers to get behind the regulator, setting out her plans for the industry as she fights to keep the top job.
“While our roles are different, and while a degree of challenge and creative tension between the regulator and the industry is not only healthy but also desirable, ultimately, in most of what we do, both regulators and the industry want the same things,” McDermott said Tuesday at a conference held by the Association of British Insurers, according to a copy of her speech.
McDermott said the industry and the regulator were both looking to promote competition and long-term economic growth in the insurance sector, but their views on “the level of pain that is acceptable” to achieve those aims “may differ.” She also used the speech to announce the FCA is starting a Debt Market Forum, working with industry and government to investigate how the country’s primary markets can work better for issuers and investors. The agency regulates more than 70,000 firms from insurers and investment banks to brokers and payday lenders.
McDermott is vying to stay in the chief executive officer role she took up on an interim basis in September, according to two people with knowledge of her application, who didn’t want to be identified because the process is private. Former head Martin Wheatley was ousted by Chancellor of the Exchequer George Osborne, and the Treasury plans to fill the post by early next year, one of the people said.
A long-time regulator, McDermott joined the FCA’s predecessor, the Financial Services Authority, in 2001 and has held a number of roles since. Best known as head of enforcement, a department she ran for four years from 2011, she’s responsible for issuing the agency’s largest-ever fines. Although she was touted by many as a potential successor to Wheatley, her enforcement background could be an impediment to her taking up the role full-time.
There is an expectation from industry any new chief would be more bank-friendly, after Osborne said in a June speech the era of “ever-larger” fines for bank misconduct was over.
“It’s not a surprise that the industry would have some residual concerns about a career enforcer heading up the regulator,” said Richard Burger, a lawyer at RPC in London, who used to work at the watchdog. “But equally in Tracey you have a highly experienced and competent regulator, who has admirably dealt with the challenges facing the FCA.”
A spokesman for the FCA declined to comment on McDermott’s application for the CEO role.