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A director of a UK charities bank that recently faced serious financial difficulties is expected to be announced as the next CEO of the Financial Services Compensation Scheme (FSCS), which protects government-guaranteed deposits in failed banks.
Martyn Beauchamp, a non-executive director of CAF Bank, has been proposed as the interim chief executive of the FSCS, according to sources familiar with the matter cited by the Financial Times. This appointment follows disagreements between regulators and the Treasury over the selection process.
The Treasury had advocated for a female candidate who was one of the final two choices, but was not the preferred option of the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), both of which approve FSCS appointments, as reported by two individuals.
Caroline Rainbird previously led the FSCS until her unexpected resignation in June. Rainbird was among a growing number of female chief executives in the regulatory sector, alongside recent female appointments to lead the pensions regulator and Financial Ombudsman Service.
The FCA and PRA have launched a joint industry consultation to enhance diversity in financial services.
The FCA, PRA, the Treasury, and the FSCS declined to comment.
CAF Bank suffered significant losses on its bond portfolio, which were large enough to erode three-quarters of its regulatory capital. These bond losses contributed to the collapse of Silicon Valley Bank in California. In early August, the Charities Aid Foundation, the owner of CAF Bank, offered £15 million in new debt to support the bank’s financial position. Beauchamp has been a director at CAF Bank since 2017.
The sources familiar with the matter stated that Beauchamp’s appointment is expected to be confirmed in the next few days and will be for a fixed 12-month term. FSCS Chair Marshall Bailey is set to step down in April 2024, allowing his successor to find a permanent chief executive.
Beauchamp’s extensive career in finance and business began in 1995 with the graduate leadership program at investment bank Robert Fleming, which is now part of JPMorgan Chase. He spent over a decade at GE Capital in Asia and the UK, followed by positions at the National Commercial Bank in the Middle East, Tesco Bank, and Sainsbury’s Argos Financial Services.
Beauchamp declined to comment. His appointment comes as the government considers measures to increase the level of protection for bank deposits beyond £85,000 and implement other changes to the UK’s regime for handling failed banks following the collapse of Silicon Valley Bank’s UK arm in March.
