Prior to the adoption of the FSA (Financial Services Authority) model, supervision of UK banks was
carried out by the Bank of England. Although the Bank of England's informal involvement in bank
supervision dates back to the mid nineteenth century, it was only in 1979 that it acquired formal powers
to grant or refuse authorization to carry out banking business in the UK. Events such as the Secondary
Banking Crisis of 1973-74 and the Banking Coordination Directive of 1977 resulted in legislative
changes in the form of the Banking Act 1979. Bank failures through the following years then resulted in
changes to the legislative framework. This article looks into the claim that the FSA model has improved
in terms of accountability in comparison to its predecessor, the Bank of England. It considers the impact
the FSA has made on the financial services sector and on certain legislation since its introduction.
Through a comparison with the Bank of England, previous and present legislation, reports and other
sources, an assessment is made as to whether the FSA provides more accountability. Evidence provided
here supports the conclusion that the FSA is both equipped with better accountability mechanisms and
executes its functions in a more accountable way than its predecessor
