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Last Updated:  Tuesday, 1 April, 2003, 15:15 GMT 16:15 UK
New head for financial watchdog
Callum McCarthy
Energy regulator Callum McCarthy has been selected to head the UK's financial watchdog.

The government said Mr McCarthy would replace current Financial Services Authority (FSA) chairman Howard Davies in September.

Mr McCarthy is currently head of the energy watchdog Ofgem.

As chairman of the FSA he will be in charge of regulating the whole of the UK's financial services industry, from banks and building societies to insurers and financial advisers.

Mr McCarthy is an economist whose early career was in the chemical industry, and in the Department of Trade and Industry.

But he also has considerable experience in the banking sector.

He was director of corporate finance at Kleinwort Benson, head of corporate finance at BZW then chief executive of Barclays' operations in Japan and North America.

Sir Howard Davies is leaving the FSA to become the new director of the London School of Economics.

Tough challenge

Sheila McKechnie, director of the Consumers' Association, welcomed the appointment but warned that Mr McCarthy faced a tough task to restore consumer confidence in the industry.

"The Consumers' Association is pleased to hear that the Treasury has appointed a person with strong regulatory experience and a track record of taking on vested industry interests.

"The challenge in the retail sector of financial services is considerable.

"Consumers have lost confidence in the financial services industry with its track record of mis-selling, confusion advertising and poor value-for-money products."

The head of ProShare, the organisation which promotes the ownership of shares, said Mr McCarthy should not try to tie forms up in regulatory red tape.

"I think he has got a big job to do, particularly in rebuilding investor confidence across the whole of the financial services industry, " said ProShare's chief executive Diane Hay.

"The trick will be for him to do this without hamstringing firms with yet more regulation.

"We also want to see him putting more money into education, not just for schools, but across the board."

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