On February 6, UK Chancellor Alistair Darling, in a speech to a trade body, addressed a number of issues relating to continued difficulties in the financial markets. He stated that one of the causes of the current credit market crisis has been the market in mortgage-backed securities, where banks repackage mortgage and other debts for resale to investors.
The Chancellor indicated that he would shortly announce a consultation on new regulations for asset-backed securities. He pledged to create a “gold standard” to enable investors to judge the quality of asset-backed securities and covered bonds. It has yet to be decided whether any such regulatory scheme will be supervised by the UK Financial Services Authority by or an industry-based self-regulating authority.