Turner spins

I was too busy yesterday to comment on the egregious statement by Adair Turner to the Treasury Committee. The man who has built a career out of Dilbert-style "Executive hair" said the FSA's failure to spot the banking crisis in advance was due to the style of regulation, and that the government had preferred a "light touch" approach. This had led to the regulator not asking enough questions about the strategies of certain banks which went on to fail.

All banks are regulated by their banking authorities in the country in which they are registered and to a lesser extent by the authorities in the countries where they operate.By all means the regulation on foreign banks operating in London should be light to encourage well-run and efficient foreign banks, whose general business risk is monitored and regulated elsewhere, to operate in the London markets.

UK registered banks whose deposits are guaranteed by the UK government should have beeen regulated to a higher degree, and in particular the overall business risks associated with the bank should have been monitored and regulated by the UK authorities, not least to protect the interests of the UK tax payer.

All this is not Mr Turner's fault. He came to the game too late but he is still paying bonuses averaging £7,000 to the FSA personnel who let this happen.