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May 22, 2012 7:01 AM GMT+0800 Bank of England Governor Mervyn King s response to the financialcrisis will be scrutinized after lawmakers pushed for an inquiry asthe central bank prepares to take over financial regulation. The Court, the Bank of England s governing body, ordered a reviewof some central bank actions, including its conduct after thecollapse of Lehman Brothers Holdings Inc. The investigation willcover the Emergency Liquidity Assistance program in 2008 and 2009,the framework for providing liquidity to banks, and the MonetaryPolicy Committee s forecasting capability, the Court in Londonsaid yesterday. The move follows a push by a cross-party committee of lawmakers foran examination of the central bank s performance as Parliamentdebates a bill to give it new powers. While King told the panel inJanuary that reviews have been carried out of all the Bank ofEngland s responsibilities, he said last month he would welcome another one if it was deemed necessary. It didn t seem reasonable that we ve had a massive financialcrisis that required the bank to respond across a number of fronts,and that its decisions and decision-making process shouldn t bereviewed in some independent way, said David Tinsley, aneconomist at BNP Paribas SA in London and a former central bankofficial. Critics of the bank will say this isn t enough. Crisis Mistakes Andrew Tyrie, who chairs the Treasury Select Committee thatoversees the central bank, said as recently as May 3 that anexamination of the handling of the financial crisis was stillneeded because lawmakers still do not have firm and agreedconclusions about the mistakes that were made and which thelegislation is, presumably, seeking to address. He said yesterday that an inquiry should have been done muchearlier, before the euro crisis deepened to aid lawmakersdebating the bill to expand the central bank s powers. Tyrie has also criticized the Court, saying in October that itsrefusal to disclose its discussions during the financial crisis was unsatisfactory and prevented Parliament from holding thecentral bank to account. He also said that he was veryconcerned on their grasp of funding provided to the bank sfinancial-stability functions. His panel s inquiry into accountability at the central bankincluded calls for lawmakers to have veto power over theappointment or dismissal of the governor. Chancellor of theExchequer George Osborne, who will appoint King s successor whenhe retires in June 2013, rejected the recommendation. Independent Reviews The reviews will be led by former Bank of England policy maker IanPlenderleith; David Stockton, a former head of U.S. research andforecasting at the Federal Reserve; and Bill Winters, chiefexecutive officer of Renshaw Bay LLP and a member of the U.K. sIndependent Commission on Banking. The Court said it expects to receive the report in October and willpublish it soon after that. It ordered the inquiry because itis important for the bank to learn practical lessons from pastexperience in order to improve the way it operates, ChairmanDavid Lees said. In the end, the chair of Court does have powers, said JensLarsen, chief European economist at RBC Capital Markets in Londonand a former central bank official. The governor is not someonewho would change his mind easily, but pressure from Court mighthave changed his view. The inquiry will address the most intense period of the financialcrisis, which included the bailout of Royal Bank of ScotlandGroup Plc, HBOS Plc and Lloyds TSB Group Plc along with the U.K. sslide into recession, according to the court. It will only cover areas where the bank had sole responsibility and will set aside events involving the so- called tripartiteauthorities that included the U.K. Treasury and the FinancialServices Authority. It also won t address the run on Northern RockPlc in 2007 as these were covered in the TSC s report The Run onthe Rock. I welcome this set of reviews, King said in the statement. Major changes to the operations of the bank have already beenmade in the light of the financial crisis. These detailed,independent reviews will help to ensure that all the importantlessons for the future have been learned. We are high quality suppliers, our products such as GU10 Led Spotlights , China Track Lighting Spotlights for oversee buyer. To know more, please visits Led Spot Lamps.
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