FCA Won’t Intervene in LSE CEO Search While Process Is ‘Orderly’By , , and
Andrew Bailey tells Bloomberg TV exchange must sort succession
LSE Chief Executive Officer Xavier Rolet left this week
The head of the U.K. Financial Conduct Authority said the regulator won’t get involved in the appointment of a new chief executive officer at London Stock Exchange Group Plc after Xavier Rolet left this week, as long as the process is "orderly."
"It’s not for me to intervene in how they run their affairs," said Andrew Bailey in an interview with Bloomberg TV Friday, the first time he’s commented publicly on the situation. But "I emphasized when Rolet announced his departure that it should be an orderly succession."
Bailey’s comments come after a tumultuous week for LSE. On Wednesday, it announced Rolet would step down with immediate effect and said Chairman Donald Brydon wouldn’t seek re-election in 2019. The decision came amid calls for Brydon to step down earlier. On Thursday activist investor TCI said “there is no change in our position” to oust Brydon following a failed multi-week attempt to keep Rolet in his role.
In addition to LSE, Bailey discussed the regulator’s role on Brexit. He testified before lawmakers Wednesday, saying that “contract continuity” was among the biggest potential disruptions in a no-deal, no-transition Brexit.
He reiterated these comments Friday, adding it was "eminently solvable but it has to be solved." He also said the value of a transition arrangement would "decline with time" as firms have to take decisions about how to operate in a post-Brexit world.
Asked about potential changes to banker remuneration rules after Brexit, Bailey said it will have to be discussed in the context of the agreement on Britain’s future relationship with the bloc but the "overall framework" of rules was more important than a single issue.
"We think we’ve got a remuneration policy based on deferral which delivers the right outcome without having to use the bonus cap," said Bailey. "But that would be a debate we would have to have within the context of that framework.”
— With assistance by Patrick Henry