The downfall of fund manager Neil Woodford has cast a shadow over the leading candidate’s chances of landing the prestigious job. Andrew Bailey has been the head of the Financial Conduct Authority for almost three years. Bailey’s answers may determine whether or not he becomes head of the U.K. central bank. According to a survey of economists, he had been the front-runner, ahead of rivals such as former Reserve Bank of India governor Raghuram Rajan, and BOE Deputy Governors Jon Cunliffe, Ben Broadbent and Dave Ramsden.
But the embarrassment of having one of the U.K. My colleagues at Bloomberg News have reported that Woodford Investment Management makes about 65,000 pounds a day in fees from the shuttered fund. On Tuesday, Bailey told the BBC the fund manager “should consider his position” on those payments. A spokesman for Woodford later rejected that call, saying “the company will continue to charge the fee as the fund remains actively managed. The pressure is on the FCA to show it can act tough when justified.
That may be impossible for the FCA chief to say. It’s impossible for any regulator to prevent blow-ups from happening on their patch. Since that poll was taken, Ofcom chief Sharon White was named chairman of retailer John Lewis Partnership Plc at a salary of 990,000 pounds, more than twice the stipend available at the central bank. Mark Gilbert is a Bloomberg Opinion columnist covering asset management.
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