Banks and other financial businesses FAQs

Answers to frequently asked questions about banks and financial regulation in the UK

Your bank or building society

Financial regulation and the Bank of England

  • The 2008 financial crisis showed that the UK (as well as the US and many EU countries) needed a new approach to financial regulation. 

    The Government abolished the Financial Services Authority in 2013 which, along with the Treasury and the Bank of England, had been responsible for financial regulation since 2001.

    The Government divided responsibility for regulation between two new bodies – the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA). 

    The PRA is a part of the Bank. The PRA and the FCA started their work on 1 April 2013.

  • We set rules for how banks should run (we call this prudential regulation).

    We carry this work out through the PRA. Our policies ensure banks have enough capital (money or other wealth, such as property or shares), and the right plans and structures in place. 

    We monitor them to make sure they follow our rules. We do this by keeping in contact with staff at all levels so we can keep an eye on things, such as their accounts and the way they work. We call this ‘supervision’.

    If a bank gets into financial difficulty, we work with it to make sure it has orderly wind-down plans in place. 

    Using prudential regulation and supervision, we try to make sure that banks are run properly and that if a bank fails it doesn’t cause widespread problems in the economy.

    Find out more about our PRA’s approach to supervision.

  • It regulates and supervises about 1,500 banks, building societies, credit unions, insurers and major investment firms

    The PRA works to ensure financial services and products are provided in a safe and sound way. It also works to ensure that insurance providers protect and can pay out to (where appropriate) anyone who buys their insurance policies.

    The government set up the PRA in April 2013 as part of the Bank of England. 

    Find out more about the PRA.

  • The Financial Conduct Authority (FCA) is a regulator that oversees more than 58,000 financial firms in the UK. It also prudentially regulates 18,000 of them.

    Its job is to protect the rights of consumers who use financial products, such as a bank savings account, mortgage or insurance policy. It is also responsible for improving the way the British financial system works and promoting competition amongst financial firms.

    The FCA is not part of the Bank of England, it is a separate public organisation. Find out more about it on the FCA’s website.

This page was last updated 11 July 2025