I said, didn't I say?

...that we're tilting towards a more regulatory approach to governance in the UK, and that people should think about that rather than banging on about Europe. I'm a bit sceptical that the current generation of people in charge at many asset managers are likely to be able to do any better than the FSA at improving the boards of banks. So dunno if they're in the string position to moan about the direction of travel (voting records of asset managers at UK banks 2006 - 2009 very unimpressive, for example). But hey.

UK bank watchdog's board meddling could backfire

Thu Mar 22, 2012 2:18pm GMT

* Shareholders should retain final say over board roles

* Regulators could end up with blame if things go wrong

* Banks already taking action to improve governance

By Sinead Cruise and Anjuli Davies

LONDON, March 22 (Reuters) - Chastened by their failure to foresee the financial crisis, it's little wonder that UK regulators might think a plasterer, among others, unfit to supervise a bank.

Britain's Financial Services Authority has halted the 1.5 billion pound sale of 630 Lloyds Bank branches to the Co-Operative Group, a move one FSA insider said was due to worries the eclectic board of the food-to-funerals giant lacked the nous to manage one of the UK's biggest retail banking networks.

A nurse, a horticulturalist and a Methodist minister keep the plasterer company at the Co-Op, along with a farmer, an ex-teacher and a retired publisher, all elected by members, with various responsibilities on subsidiary or regional Co-Op boards.

After the high-profile failures at some of Europe's biggest banks during the 2007 financial crisis and beyond, regulators looking to beef up oversight of bank boards are unlikely to appreciate the value of that breadth of experience.

But industry experts warn regulators could live to regret heavy-handed interference in the make-up of UK bank boards, as one-off interventions risk evolving into a burden of day-to-day supervision they could struggle to handle.