Contest for top PRA post enters final straight

The new head of the UK’s banking and insurance supervisor is expected to be named this week, ending a game of musical chairs between top UK officials.

A handful of shortlisted candidates have completed final interviews to be chief executive of the Prudential Regulation Authority, which carries with it a deputy governorship of the Bank of England.

The Treasury and the BoE are poised to make an announcement in the coming days, say people familiar with the matter.

Charles Roxburgh, a former management consultant and trusted mandarin who oversaw last year’s Fair and Effective Markets Review with the Financial Conduct Authority and BoE, is one figure thought to be in the running.

Last year, he was charged with finding a new head for the FCA but he is notably absent from the selection panel for the PRA job.

A coterie of trusted lieutenants who supported Andrew Bailey, the previous PRA head, are the internal frontrunners. They are Lyndon Nelson, Mr Bailey’s deputy, described by a former regulator as “amazingly wise”; Sam Woods, the affable head of insurance; and Megan Butler, who is on secondment to the FCA as head of supervision.

The PRA declined to comment.

The role is one of the most powerful in the City. The PRA, which came into being in 2013, supervises the safety and soundness of the largest banks and insurers.

The top job became available when George Osborne moved Mr Bailey, the “safe pair of hands” incumbent, to lead the beleaguered FCA. The sister watchdog’s problems were caused in no small part by an earlier decision by Mr Osborne to remove Martin Wheatley as chief executive last year.

The PRA job is generally considered an easier position to fill as it has less of a politically charged and public-facing role. The remit of the prudential regulator is narrower and less adversarial than that of the FCA, with far fewer companies to oversee.

Minouche Shafik and Sir Jon Cunliffe, two of Mr Bailey’s fellow deputy governors at the BoE, were quick to rule themselves out of the race to replace him.

Ms Shafik is on the selection panel for the PRA job, along with Anthony Habgood, who leads the BoE’s overseeing court, Sir Nicholas Macpherson, the outgoing permanent secretary at the Treasury, and John Kingman, a Treasury mandarin.

An added complication to the PRA race has been the parallel battle to succeed Sir Nicholas. Tom Scholar, who led talks in Brussels on a new UK deal with the EU, beat Mr Kingman to the position, leaving open whether Mr Osborne might appoint Mr Kingman to the PRA job as consolation. Friends close to Mr Kingman report that he is instead keen to join the private sector.

People close to Mr Bailey suggested he might try to persuade Ms Butler to remain at the FCA when he joins in the summer. She had initially joined on a one-year secondment after Mr Wheatley’s ousting.

“Any of those names would be good and could do the job,” said one senior banker. “The priority will be to follow on from what Andrew Bailey is doing; he has done a great job. It is almost as straightforward as that.”