Oration for Andrew Bailey

Written and delivered by Nigel Siesage, 26 January 2018

You may be surprised to know, if you have one of these notes in your wallet, that you already have a contract with our honorary graduand. It reads, “I promise to pay the bearer on demand the sum of Ten Pounds” and is signed “Andrew Bailey, Chief Cashier”.

Andrew was Chief Cashier of the Bank of England from 2004 to 2011, and he says that taking a new banknote from a blank sheet of paper through to circulation (as he did with the Adam Smith £20 note) was a particularly interesting aspect of the role.

But be careful - those old £10 notes cease to be legal tender on 1 March.

Bankers, according to surveys, are regarded by the public as a particularly untrustworthy profession – and it is little comfort that they are seen as more trustworthy than journalists and politicians.  But Andrew Bailey is no ordinary banker. For much of his career, and particularly in his present role as Chief Executive of the Financial Conduct Authority, he has been responsible for upholding the highest standards of probity in the financial services sector.

Andrew Bailey comes from Leicester. He was educated at Wyggeston Boys Grammar School, as it was then called – now the VI form college next to the University’s main campus. Although he cannot recall his career ambitions at that time, he is confident that they did not extend to being a central banker or a financial regulator.

A successful school career was followed by an equally successful University one, as Andrew proceeded to achieve a first in History at Cambridge, and then take a PhD on the impact of the Napoleonic wars on the development of the cotton industry.  

This led to a brief spell as a researcher at the London School of Economics, but Andrew concluded that he was not called to the academic life.

The Bank of England, which he joined in 1985, offered a far more interesting path. There, at the heart of the nation’s economic affairs, he held positions of increasing importance. Perhaps most significant for his personal development, from 1996 to 1999 he was private secretary to the then Governor, Eddie George – “steady Eddie” – for whom Andrew came to have considerable respect as a man of great judgment and with a strong commitment to the Bank and its values. This was a period of significant change, when on the one hand the Bank took responsibility for setting interest rates through the Monetary Policy Committee, while on the other, supervisory responsibility for the financial services industry was transferred elsewhere.

From 2007 to 2011, Andrew played a vital role in ensuring that the country survived the financial crisis, taking responsibility for the Bank’s operations to resolve problems in the banking sector. The present Governor, Mark Carney, has said he regards Andrew’s work in managing the crisis and developing a new regulatory framework as exemplary.

We should not forget how desperate the financial crisis was, both in the UK and around the world. Famous and seemingly unshakeable names – which might have said they were “as safe as the Bank of England” - like Lehman Brothers, Lloyds Bank and Royal Bank of Scotland, went bankrupt, or had to be bailed out. Economies around the world were locked in recession. Individual investors, large and small, suffered – and it is a matter of lasting sadness to Andrew that the financial crisis caused so much pain to so many.

In such circumstances, steadiness, clear thinking and vision were needed. Andrew Bailey has provided them. In April 2013 he became the Chief Executive of the new Prudential Regulation Authority. And then in 2016 he was appointed to his present position as Chief Executive of the Financial Conduct Authority, responsible for maintaining the integrity of the UK’s financial markets through regulation of all the many firms (banks, building societies, financial advisers) that provide financial services to consumers. It specifies standards, carries out investigations and can impose bans.

We all have an interest in its effectiveness, and it is not surprising that the FCA is subject to close critical attention. The FCA, and the name of Andrew Bailey, are rarely out of the news. Controversy is never far away – within the last fortnight, for instance, with regard to the treatment of small businesses by the Royal Bank of Scotland.

Understandably, one of Andrew’s principal concerns at present is the impact that leaving the EU will have on the sector he regulates, and whether the UK will be able to maintain open financial markets.  He is also troubled by increasing levels of indebtedness and lower levels of savings at younger ages, with the consequences this may have for retirement in future generations.

Andrew’s is a huge and exceptionally demanding job, so it is reassuring that our chief financial regulator is capable of escaping its pressures with his family – his greatest satisfaction in life – and that he still finds time to disappear with them twice a year to a small community in Idaho (his wife’s home state) to go skiing and mountain biking.

As the then Chancellor of the Exchequer, George Osborne, said at the time of Andrew’s appointment to the FCA:

“Andrew is simply the most respected, most experienced and most qualified person in the world to do the job. …  Anyone who has dealt with Andrew knows he will be tough but fair, and understands the flaws and merits of the sector better than anyone."

That is an accolade that we are happy to endorse today.

Mr Chancellor, on the recommendation of the Senate and the Council I present Andrew John Bailey, that you may confer upon him the honorary degree of Doctor of Laws.

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