
Andrew Bailey warns Rachel Reeves against bonfire of red tape
The Bank of England Governor was asked by MPs on Tuesday if he agreed with the Chancellor's recent claim that regulation is 'the boot on the neck' of business.
'I do not use those terms,' he said. 'There are areas where we clearly should look at [revising regulations]. But we cannot compromise on basic financial stability, that would be my overall message.'
His comments come a week after Ms Reeves announced a roll-back of regulation in the City in an effort to boost growth. The Chancellor used her Mansion House speech to urge financiers to ditch their 'excessive caution' and called for regulators covering industries beyond the City to loosen the rules to aid the economy.
Mr Bailey hailed the opportunity to ditch EU red tape that was not designed to suit Britain's market, but said Ms Reeves should be wary of going too far. He told the Treasury select committee: 'When I hear people say, 'The financial crisis is now way in the past, we've got passed that, that's all solved, that's all out of the way, move on' ... For those of us who were veterans of sorting the problems of that out, I think we probably all feel in some ways ... erm ... no.
'Yes of course the world moves on ... [But] we had a very serious recession in this country after [the financial crisis]. So I do react to people who say that.'
He added: 'Success in financial stability is when nothing happens. The fact we've had market volatility this year and we haven't had a financial stability problem and we're not worrying about banks failing ... is of course a success.
'It's not always easy to point to it and say, look, this is good news. But the UK banking system is very resilient.'
Relaxing ring-fencing rules
Mr Bailey specifically warned Ms Reeves against relaxing so-called ring-fencing rules, which divide retail banking from the racier world of investment banking.
The Chancellor last week announced the ring-fencing regime would be 'reformed' as part of her overhaul. She has instructed the economic secretary to the Treasury to review the policies, 'looking at how changes can strike the right balance between growth and stability'.
However, Mr Bailey said: 'The ring-fencing regime is an important part of the structure of the banking system.
'It makes resolution of banks, if they get into trouble, much easier, and it benefits, particularly in terms of UK customers and UK consumers, businesses and households. That is a helpful feature of it, I don't think it hinders banks fundamentally.
'It has established itself as part of the system and to me it would not be sensible to take it away at this point.'
Risks are growing in financial markets, the Governor added, with heavy government borrowing in the UK and around the world driving up debt interest costs. High prices in stock markets also pose dangers, he said.
He sounded the alarm over American tech stocks, singling out the soaring valuation of chip company Nvidia as a sign of the extent of market enthusiasm.
'In the US, it is a very strong tech-led growth story. The market capitalisation of Nvidia is now larger than the UK's GDP,' said the Governor. 'It is up 20pc this year. That is a pretty striking fact. It is 7pc of the overall market capitalisation in the US.'
While Mr Bailey warned Ms Reeves not to go too far on City reforms, he said allowing banks to make more loans worth over four and a half times the income of homebuyers could help tens of thousands first time buyers onto the property ladder.
He urged more banks to apply for permission to dish out larger mortgages. He said: 'It is very simple. We have changed the policy overnight. All you need to do is send us an email, ask for what we call a modification by waiver, it is yours.'
The Governor said one bank has already obtained that permission, with another going through the process.
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles


Daily Mail
10 minutes ago
- Daily Mail
Americans swoop on yet another UK fintech champion: Corpay to buy FTSE 250 Alpha Group in £1.8bn deal
Another British fintech champion is to be bought by American predators – in a deal worth £1.8billion. The board of Alpha Group – led by former Virgin Money boss Jayne-Anne Gadhia – has accepted a bid from US payments giant Corpay. Shares in the FTSE 250 payments company soared more than 25 per cent after bosses recommended that investors back a sweetened 4250p-per-share offer. The deal comes amid a mounting crisis as a takeover frenzy accelerates. Research from broker Peel Hunt shows the UK is on course for the biggest year of takeovers since 2021, after £74billion of offers in the first half of 2025. Scientific testing firm Spectris has agreed to be bought by American private equity firm KKR for £4.7billion in the biggest deal of the year after a bidding war with Advent International. US semiconductor group Qualcomm is to buy British chipmaker Alphawave for £1.8billion and Deliveroo was swooped on by DoorDash with a £2.9billion offer. Another takeover battle saw Primary Health Properties beat KKR to buy GP surgery owner Assura for £1.8billion. And companies are switching listings to New York, with fintech darling Wise the latest planning to defect. Meanwhile, a lack of fresh listings through initial public offerings means they are not being replaced. Alpha turned down Corpay's initial £1.2billion offer in May but, after talks, the latest bid is a 55 per cent premium to Alpha's undisturbed share price of 2745p on May 1, before news of the takeover interest became public. Dan Coatsworth, an investment analyst at AJ Bell, said: 'The market completely misjudged how much Corpay would offer, judging by the share price jump on the formal bid. 'While the shares enjoyed a little bump on the initial approach, the market didn't price in a successful bid. The fact Alpha rejected a proposal made it clear to Corpay that it would have to dig a lot deeper or walk away. 'It got the message loud and clear and Corpay looks to have gone in with its best offer. 'The 55 per cent bid premium is much more generous than the 40 per cent average seen across UK-listed takeovers so far in 2025.' Corpay, an S&P 500 company with a market capitalisation of around £17billion, has its headquarters in Atlanta, Georgia. Following the sale, Alpha will continue to be based in London. But there could be 'possible role overlaps' in some administrative and head office functions, the companies have warned. If job cuts are made solely within Alpha's business, it could affect up to 13 per cent of staff. The takeover, which must be approved by 75 per cent of shareholders, is expected to complete in the final quarter of the year. Alpha chairman Gadhia said: 'I am delighted Corpay has made an offer which the board considers to be in the best interests of shareholders, clients and staff.' Corpay boss Ronald Clarke said: 'We couldn't be happier to acquire Alpha.'


The Sun
10 minutes ago
- The Sun
Outrage as luxury £425 a night hotel paid for by YOU taken over to house asylum seekers in ‘insult to law-abiding Brits
BRITAIN'S borders fiasco worsened last night when the Home Office took over a four-star hotel that costs tourists up to £425 a night. Rooms at the Britannia International, which boasts 'superb views over London', are being readied for asylum seekers at taxpayers' expense in anticipation of a summer surge in Channel crossings. 7 7 The move was last night branded an 'insult'. Residents and business owners said they fear for their safety, and that it would attract protests. A demo was held there on Tuesday and yesterday police guarded the hotel, while a fence had been thrown up around its entrance. Workers hauled beds inside, as Tower Hamlets Council confirmed it would be used for migrants — and said they should get the 'full package of support'. Britannia Hotels has hailed its biggest and flagship residence — as a 'modern, glass-fronted building close to the internationally famous business district'. When open to the public, a standard room can cost as much as £425 a night. They are said to have 'superb views over London'. The hotel offers two restaurants and bars, making it the 'perfect base for a city break'. Amenities include a games room with a pool table and gym. It is unclear if migrants will be allowed to use them. An indoor pool and sauna are thought to have been shut down. Shadow Home Secretary Chris Philp told The Sun: 'It is outrageous that the Government is splurging taxpayers' hard-earned money on luxury hotels for illegal immigrants when most people in this country would struggle to afford a hotel in central London. 'This is one of the most luxurious hotels people can only dream of staying in, right in the heart of London's financial centre. 'No wonder illegal immigrants are flooding across the channel in record numbers when this weak Labour government welcomes them with hotel accommodation funded by hard-working taxpayers. 'This is an insult to law-abiding citizens. 'The Government must urgently act to deport every single illegal arrival, then the crossings would rapidly stop but Keir Starmer is too weak to do this.' Susan Hall, Tory leader in London's City Hall, added: 'It's incredible that four-star hotels like this are being used to house migrants. 'This move will damage every small firm in Canary Wharf trying to survive. 'Women and children, I can tell you, don't feel safe around these hotels in London. 'It shows things are getting worse and worse for hard-working Brits, who are trying to keep their families going. 'This is the damage it is doing to society, and I think it is going to cause a really serious problem.' Some 23,534 migrants have already arrived on small boats this year — 48 per cent higher than this time in 2024. Sources indicated the International will remain empty until necessary, with the Home Office striking a deal to rent 400 rooms for £81 a night. It means the weekly bill for the hotel could be up to £226,800 if every room is used. Yesterday labourers were seen carrying mattresses into the hotel shortly after 8am. A team flanked by private security also brought in metal bed frames and a pallet of orange juice and food. It is thought agency staff have been drafted in to run it, with existing contractors let go. A cleaner and mum of two arrived for her last shift yesterday and said: 'I don't think it's right that I and all the staff have been given redundancy letters. 'We are taxpayers and have done nothing wrong. 'Now we will struggle to make ends meet. 'We are gutted.' On Tuesday 150 anti-migrant activists protested outside the International until 9pm. Just five took part in a counter protest. Some flocked there amid false rumours circulated by far-right thug Tommy Robinson that migrants had arrived there from the Bell Hotel in Epping, Essex — also the scene of demos. Around 50 cops were drafted in to Canary Wharf, with no arrests. 7 7 Reform's chief whip Lee Anderson was at the International demo and said he was 'absolutely furious' at the hotel's closure. The MP added: 'This hotel here — it must cost a couple of hundred quid a night to stay there. 'Most normal people in this country would not be able to afford to stay here for a weekend, but we have illegals coming here.' Yesterday local homeowners told of their fears that a migrant hotel would tank property values. Software engineer Matt, who declined to give his surname, said: 'The houses here go for £1million, though probably not any more. 'I'm really worried about house prices going down. 'Now seems a bad time to sell up.' Mary, 58, who lives five minutes away, fumed: 'This used to be the best place in the world but it's gone to the dogs. 'I struggle on my pension. 'I paid taxes all my life. And they are in a four-star hotel?' It is thought there are 210 asylum hotels in the UK. It is important that the Government ensures that there is a full package of support for those staying at the hotel The council Chancellor Rachel Reeves and Home Secretary Yvette Cooper have pledged to cut their use entirely by 2029. The Britannia Hotel group was approached for comment. It has a portfolio of 64 UK hotels and is a major provider of asylum accommodation. A cost-cutting drive has seen the average price of a migrant hotel room fall to £118.87, down from £162.16 in March 2023. Last month we told how the annual asylum support bill of £4.7billion was equivalent to the annual taxes forked out by a city the size of Manchester. Tower Hamlets Council said: 'We are aware of the Government's decision to use the Britannia Hotel in Canary Wharf to provide temporary accommodation for asylum seekers. 'It is important the Government ensures there is a full package of support for those staying at the hotel. 'We are working with the Home Office and partners to make sure that all necessary safety and safeguarding arrangements are in place.' The Home Office said: 'We inherited a broken asylum system from the Tories with costs spiralling out of control. 'As part of the plan to restore order and close all asylum hotels by the end of the parliament, we are boosting border security, substantially increasing removals of those with no right to be here. 'We are also tackling the Tories' wasteful contracts by ending the use of more expensive accommodation and moving to cheaper options.' 7 7 7


Daily Mail
10 minutes ago
- Daily Mail
Deloitte probed over Glencore audits after commodities giant is hit by bribery and corruption lawsuits
Deloitte is being investigated by the UK accounting watchdog over its audits of Glencore's finances. The Financial Reporting Council (FRC) will probe the Big Four firm's work for the Swiss commodities giant over an eight-year period. It will look into whether Deloitte gave 'sufficient consideration to the risk of non-compliance with laws and regulations' when signing off accounts between 2013 and 2020. Glencore has been rocked by bribery and corruption lawsuits in the last few years. The FRC noted that the FTSE 100 commodities trader and miner and a UK subsidiary had been 'subject to investigations by government agencies into misconduct'. In total Glencore, which produces coal, copper, nickel, zinc and cobalt, has had to pay out over £1billion after legal action in Brazil, the UK, and US. Probe: Big Four accountancy firm Deloitte is being investigated by the Financial Reporting Council over its audits of Glencore's finances In 2022, it was fined £281million following an investigation by the UK's Serious Fraud Office. The SFO found Glencore paid nearly £21million in bribes to gain preferential access to oil in Africa. It flew cash to Africa and falsified documents. In 2022 Glencore admitted bribery and failure to prevent bribery after transactions in Cameroon, Equatorial Guinea, Ivory Coast, Nigeria and South Sudan. Six former executives have been charged with bribery. A trial is yet to begin. Regulators are probing Deloitte's work on four audits, including for bus operator Go-Ahead, fashion brand Joules, car seller Lookers and fintech Stenn. Deloitte UK said: 'We are committed to the highest standards of audit quality and will fully co-operate.' The FRC can impose fines and non-financial penalties if it finds wrongdoing. In 2019 Deloitte was fined £4.2million for its audit of outsourcing firm Serco, which had paid more than £20million to settle fraud and false accounting charges. This year PwC was hit with a £4.5million fine for 'serious failings' in its 2019 audit of Wyelands Bank. Big Four peer KPMG paid out £4.5million after 'serious failures' in its audit of Rolls-Royce's 2010 accounts. In January, the FRC probed KPMG's audit of Ladbrokes-owner Entain's 2022 accounts. The gambling giant paid a £615million settlement to resolve a probe into alleged bribery at its former Turkish online betting business.