Today's news about Andrew Bailey's appointment as CEO of the FCA is a significant and, no doubt, highly political appointment.

The decision to stop a review of culture in banks and the appointment of a prudential regulator at the FCA are linked (whether explicitly or deliberately or not).  The banks will probably welcome this news – as will insurers – as this probably signals a continuing shift in emphasis within the FCA towards prudential concerns, fostering competition and innovation and ensuring the UK regulators stand up for UK financial services, rather than assisting the EU to 'level the playing field' and take away our global status.

The impact on retail distributors, conduct regulation and the expectations on firms that deal with consumers is less predictable.  Will they enjoy lighter touch regulation (as suggested by the thrust of FAMR and the Project Innovate) or will misconduct and poor cultures at the customer-facing end of the financial services market be used as a political football to demonstrate the Regulator's intent?

Bailey's attitude to Europe and relationship with the Treasury will likely be determinative.  We will watch with interest.