The FSA will merge its retail and wholesale supervision departments as part of a wide-range of reforms in October.
Following its failure to correctly supervise Northern Rock and anticipate the financial crisis, politicians cited the need for major changes in the way the FSA handles macro-economic risk.
The FSA says it hopes to implement the changes outlined by the Turner Review, and adapt from lessons learnt following the Northern Rock debacle, on 1 October.
Reforms are intended to better align the FSA’s internal operations with its core acitivities of identifying risk, supervision and enforcement.
Regulators will have a greater role in the areas of macro-prudential analysis, international regulatory engagement and consumer financial education to take account of its changing responsibilities.
Retail and wholesale supervision will be integrated into a single unit under the control of managing director Jon Pain. Risk functions will also be combined, with the new department headed by Sally Dewar.
The existing financial stability team will be extended, and a new international division will be created to meet the needs of macro-economic and international regulation.
Hector Sants, chief executive of the FSA, says: “These changes will provide greater clarity, both internally and externally, as to the way we work and, in particular, reinforce our role as micro-prudential supervisor based on a model of integrated risk analysis and integrated supervision.
“I believe the actions we have taken since the crisis began have shown the effectiveness of this model. This reorganisation will ensure our changing working practices and the way we make our judgements are successfully institutionalised.”
PARTNER INSIGHT: For many advisers, outsourcing to a multi-manager or discretionary fund manager makes sense, allowing them to focus on the adviser-client relationship
An added tier of asset management can of course deliver additional benefits for certain investors, writes Graham Bentley - just be sure you can justify it to the regulator and, especially, the client
The government is "in daily contact" with industry figures over the pensions dashboard as it prepares for the roll-out and its feasibility report, Guy Opperman has said.
Organisation led by Johnny Timpson
From 1 April 2019