The Financial Services Act 2012 brought major reforms to create a UK regulatory framework which is focused on the issues that matter and better equipped to deliver financial stability.
On 1 April 2013 the new legislation established an independent Financial Policy Committee (FPC) at the Bank. The Committee is charged with a primary objective of identifying, monitoring and taking action to remove or reduce systemic risks with a view to protecting and enhancing the resilience of the UK financial system. The FPC has a secondary objective to support the economic policy of the Government.
Previously, in February 2011, the Bank’s Court of Directors created an interim FPC to undertake, as far as possible, the future statutory role of FPC. The interim FPC held its first policy meeting in June 2011, and met on a quarterly basis thereafter.
The Committee publishes a record of its formal policy meetings, and is responsible for the Bank’s bi-annual Financial Stability Report.
The Committee has thirteen members, of which six are Bank staff including The Governor, four Deputy Governors and the executive director for financial stability.
Five members of the Committee are independent experts chosen from outside the Bank, and selected for their experience and expertise in financial services. The Chief Executive of the Financial Conduct Authority is also a member. The Committee also includes a non-voting member from HM Treasury.